Risk Management in Transport PPP Projects
In the Islamic Countries
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Based on the analysis of the existing literature, it seems that risk management practices and
processes in Mozambique are extensively addressed in the PPP law and in its implementing
regulation. The principles and provisions included in the legislation foresee the appropriate
management of risks at all stages of the PPP project life-cycle from project idea to project
closure. Risks as well as institutional responsibilities and timing of risk evaluation and
monitoring reporting are also identified and reference is made to the use of guidelines/pre-
defined models for ex-ante appraisal and ex-post assessment. Mozambican institutions seem
however facing difficulties in the application of legislative provisions. This issue seems primarily
triggered by the lack of capacity and resources and unavailability or in any case inadequacy of
the existing guidelines and models, that may require adaptation/improvement (see also SET,
2018).
Performance metrics
According to PPP legislation, line Ministries, have ultimate responsibility on the monitoring of
the PPPs in their sector of competence. The Ministry of Economy and Finance has responsibility
in supervising the monitoring of the economic and financial performance of the PPPs in all
sectors. The Regulatory Authorities have responsibilities in controlling the delivery of the PPP
under the contractual standpoint and make sure the parties conform to the terms set in the PPP
contracts.
Auditing and monitoring procedures are also defined by law. The Regulatory Authority has
responsibility to elaborate monitoring reports on the performance of the PPPs, every six
months. These reports shall be submitted to the line Ministries and to the Ministry of Economy
and Finance. This information is to be gathered both at the construction and operational stages
of the delivery of the PPP contract. The monitoring activity performed by the Regulatory
Authority shall encompass the technical and functional scope of the project as well as its socio-
economic and financial targets. This authority is responsible for the verification of the fulfilment
of the contractual provision by the public and private parties. To the purposes of elaborating
these reporting activities the line Ministry is responsible of defining the tools and models
required for the measurement of the progresses of the works during the construction stage and
performance parameters for the assessment of the PPP at the operation stage. The Ministry of
Economy and Finance is responsible for the definition of the tools andmodels for the monitoring
and reporting of the economic and financial performance of the PPPs. In order to elaborate the
periodical reporting, the Regulatory Authority shall collect the relevant information from the
PPP contractors. Accordingly PPP contractors have reporting obligations on a biannual basis.
The line Ministry and the Ministry of Economy and Finance shall furthermore elaborate
individual and global monitoring reporting on the PPPs. The PPP contract shall explicitly include
the type of information required for monitoring purposes along with the responsibilities and
competent authorities involved in the follow up procedures and the monitoring schedule.