Risk Management in Transport PPP Projects
In the Islamic Countries
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“PPP project” is thus part of good practice and a way to achieve a viable alignment of
incentives for the various parties. For instance, a project structured as PPP may involve
the inclusion of an existing asset as part of the concession agreement or other value
capture mechanisms, such as the ability to share land value uplifts generated by the
project. Also, the current practice in PPP schemes is limited to few variations of the
remuneration rules. In light of the increasing number of initiatives, due consideration
should be made of the evaluation of alternative remuneration/regulatory schemes
(Least Present Value of Revenues (LPVR) approach, share-in-profit/Joint Venture
approach).
 Legislative measures: Consideration should be given to the role of unsolicited proposals,
which are more critical under the risk management standpoint, as the preliminary studies
and the overall PPP concept is developed by the private party. It is recommended,
depending on available resources, to gradually increase the budget available for feasibility
studies so that at least up to this level the studies are developed by the public authority.
 Procedural measures: Given the relatively limited size of the country, due consideration
should be given to ensure full competition and open market, reducing the potential
dominance of private groups.
 Statistics and surveys: Transparency in institutional activities should be further
pursued, especiallywith respect to open data policy concerning preparatory and feasibility
studies, transport statistics, cartography, transport models.
 Capacity-buildingmeasures: Further strengthening the capabilities is a keymeasure and
could be done by means of support from International Funding Institutions and
Multilateral Agencies.
5.3. African cluster, Case study 2: Mozambique
5.3.1. Introduction
Scope of the case study
The scope of this case study is to illustrate the practices currently in place for the management
of the risks associated with PPP projects in the transport sector in Mozambique, with reference
to the entire life-cycle of Public-Private Initiatives and the elements of the conceptual framework
identified at Chapter 3. Existing literature and publicly available information represent the main
sources for the elaboration of this case study.
Overview of PPPs in the transport sector
The Table below provides basic information on the Public-Private Partnership initiatives that
according to the State General Account Report by the Mozambican Supreme Audit Institution
(Tribunal Administrativo) were active in 2017 in the country. The report refers to a total of 22
PPP concessions, of which 11 relate to the transport sector.