Risk Management in Transport PPP Projects
In the Islamic Countries
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evidences of such type of activities and the report by the Supreme Audit Institution denunciates
gaps in this respect.
In addition to the issues identified by the Supreme Audit Institution in the monitoring of the
existing PPPs, gaps seem also existing at the stage of planning and identification of the initiatives
to be further developed and eventually implemented as PPPs. As a matter of fact national
transport master plans and strategies do not seem to be available which set and prioritize
investments also identifying those that may be more suitable to be implemented as PPPs. The
existing PPP contracts have been all developed on the basis of unsolicited proposals, which
demonstrates a dominant reactive approach rather than a proactive attitude towards the
management of PPPs. Sector responsibilities also complicate the framework as the Ministry of
Public Works and Housing has competence in road transport, whereas the Ministry of Transport
and Communication has responsibility over rail and maritime projects, specified that CFM has
historically retained all competences in the rail sector. The governance of the PPPs in the rail-
maritime sector is furthermore complicated by the fact that CFM is also a shareholder in the PPP
projects in the rail-maritime sector, with an apparent situation of conflict of interest also
evidenced in other studies (USAID, 2010; Fischer & Nhabinde, 2012; WB, 2012; DFID, 2015;
Supreme Audit Institution, 2018). To solve this criticality the regulatory authority INATTER was
assumed to take over the role of supervising and monitoring agencies. However this does not
seem to have occurred yet in practice (Supreme Audit Institution, 2018), and it is not clear
whether this institution has the resources and capacity to perform such control and monitoring
duties.
In order to respond to the questions raised by the Supreme Audit Institution, the government
was also assuming to amend the existing legislation (Supreme Audit Institution, 2018). Changes
in the legislation and procedures in the above summarized context may however not be
effective. The fragmentation of the existing institutional setting and its fragility in terms of
capacity seem representing a potential risk that legal provisions and procedural best practices
may not be implemented and even implementable. A structural reformmay be required to solve
the fragmentation of competences and responsibilities as well as the existing conflicts of interest
affecting the rail-maritime PPPs. In addition, measures aimed at strengthening the technical
capacity of the personnel should be considered. Both the Fiscal Risk Unit and the Supreme Audit
Institution appear to have greatly benefited from training programs that increased their
capacity in the field of project financing and PPPs. Such measures could be extended to other
institutions provided that PPP units/departments are previously identified and resources
allocated to them.
Investment attraction
The Investment & Export Promotion Agency – APIEX, has been established by the Mozambican
government under the control of the Ministry of Industry and Commerce, with the purpose of
attracting private foreign investments to Mozambique. The agency is acting as a one-stop shop
for potential foreign investors and the promotion of PPPs is also foreseen among its activities,
specified that the unit is not dedicated to PPPs.