Risk Management in Transport PPP Projects
In the Islamic Countries
137
afford due technical difficulties and/or financial capacity, the fact that PPPs has manifold
purposes according to the legislation has been criticized in literature of being possible cause of
potential lack of transparency at the tendering stage, as these elements are used to define
evaluation criteria and weights are assigned to them in the scoring function of PPP bids. This
practice may favor incumbent companies and discourage or in any case increase the difficulty of
the participation of new entrants in the market. Also considering the difficulties by the
Mozambican institutions in terms of capacity and resources to plan, develop and monitor
effectively PPPs, the PPP systemwould actually benefit from the use of simple and standardized
criteria for the identification and tendering (including bid evaluation and awarding), as well as
follow up of PPP projects and contracts (Fischer & Nhabinde, 2012). This would also result in a
more transparent system and mitigate potential risks of corruption.
As commented in the previous section above, studies to compare the PPP solution with other
procurement models do not seem to be performed in the Mozambique in support of the decision
to implement a project as a Public-Private Partnership (WB, 2018). On the other hand the PPP
legislation gives duly importance to affordability analysis and assess the development,
implementation and follow up of the contract in the framework the state liabilities. This is
appropriate given the difficulties by Mozambique in managing its public debt (IMF, 2019b). The
Ministry of Economy and Finance is involved since the conceptual stage in the
definition/improvement of the feasibility studies under responsibility of the line Ministry.
Models are also referred to in the PPP law implementing regulation that serve the purpose of
assessment and reporting of the liabilities and set of analysis required to analyze and control
the implications of state commitments over the entire duration of the projects. Progresses and
impacts of the PPPs should be furthermore reported in the General State Account at the end of
each financial year. state budget proposals should include forecasts of the liabilities assumed for
compensations and subsidies to be considered under the scope of state debt sustainability
analysis. As also reported by the Mozambican Supreme Audit Institution, notwithstanding the
availability of a detailed and comprehensive legislation the accounting and monitoring system
by the line Ministries and regulatory Authorities do not seem to be performed or fully performed
at present and the supervision and monitoring reporting by the Ministry of Economy and
Finance appear to have only recently improved thanks to the establishment and entry into
operation of the Fiscal Risk Unit (Supreme Audit Institution, 2018).
The PPP legislation allows the submission by the private sector of unsolicited proposals . On
the basis of unsolicited proposals the line Ministry can proceed to the promotion and launch of
a tendering process aimed at developing and implementing the project as a PPP. The promoter
is not entitled to any compensation for the preparation and submission of the unsolicited
proposal. In the event the promoter will participate in the tender, the legislation establishes that
a preference margin of 15% in the assessment of technical and financial criteria are given as a
bonus to their offer. It appears that up to now, most if not all the PPPs implemented in
Mozambique have been identified on the basis of unsolicited proposals. This fact seems on one
side confirming the fragility and lack of capacity by the public sector to develop strategic policies
and plans and more importantly to identify and prepare priority investments among which