Transcript Preparing PPP programs David Duarte Arancibia – [email protected] Head of Contingent Liabilities and PPPs Ministry of Finance - Chile.

Preparing PPP
programs
David Duarte Arancibia – [email protected]
Head of Contingent Liabilities and PPPs
Ministry of Finance - Chile
Issues to cover
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Legal framework
Project selection
Fiscal support
Financial regulations
Others
Legal framework
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Flexible
Open to competition
Private initiatives
Contract modifications
Possibility to terminate the concession
Dispute resolution system
Financial guarantees
Institutional Design
• PPP unit outside of MoF
• Permanent involvement of the MoF in the projects and
programs
• CBA and VfM approval independent of MoF and PPP unit
• Check and Balance Framework
Project Selection
• Cost Benefits Analysis
• Value for Money
• Risk allocation
• Efficiency criteria, not other as accounting issues
• Rational fiscal commitments
• Contingent liabilities
• Fiscal payments
Fiscal Support
• Correctly designed
• Specific objective
• Efficient
• Aggregate economic efficiency
• Sustainable
• Government has to be able to afford the commitments
• Program has to be congruent with fiscal planning
• Stocks and cash flows has to be estimated
• Avoid fiscal surprises
Financial regulations
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Taxation framework
Banks investment regulation
Pension found investments
Specialized financial institutions supervision
Others Issues
• State of law
• Culture of payments
• Toll roads
• Land acquisition framework
• Political support
• PPP seems a privatization
Recommendations
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Correct project selection (CBA, VfM)
Realistic times
Good base studies
Specialized advisory
Permanent supervision
Transparency (contracts, agreements, fiscal commitments, etc)
Disseminate information
Contingent liabilities management
Assess risk transfer
Make sound economic decisions
Preparing PPP
programs
David Duarte Arancibia – [email protected]
Head of Contingent Liabilities and PPPs
Ministry of Finance - Chile