Risk Management in Transport PPP Projects
In the Islamic Countries
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development and implementation scheme risks related to construction work defects and timely
execution of the project can be also shared or borne by the private party.
Box 27 Construction works under the PPP initiative for the Bejaia Mediterranean
Terminal - BMT
Responsibilities in terms of the implementation of the works for the container terminal at the
port of Bejaia were shared between the public and private parties of the BTM SPV, respectively
EPB and Portek. EPB had responsibility over the construction of the basic port structure and
Portek had to provide and install the superstructure equipment and facilities. Works started in
November 2004 and were effectively implemented by EPB in the expected timeframe,
notwithstanding some constraints related to the exploitation of the port area. Rail mounted
cranes were delivered at the port beginning of 2005 and the first vessel was handled in June 2005.
According to the scheme adopted for the BTM PPP, risks relating to the implementation of the
project were shared between the public and private party (Aoumad, 2017).
The allocation of the risks and responsibilities according to the model adopted for the
implementation of the container terminal of the port of Bejaia is deemed appropriate, also
considering the experience of Algeria in the implementation of construction works and the
experience of the private operator in its field of operation.
5.4.6. Operation
Management of risks during operation
The implemented PPP initiatives in the transport sector in Algeria are all managed by public-
private entities where the public and the private parties share the management and
management board of the SPV, where due to the 49/51% rule the public party manages the
board of directors and the private party retains responsibility on the management of the
operation of the infrastructure and/or delivery of the services. More specifically the public party
usually manages the financial and human resource departments whereas the technical,
operational and marketing departments are usually managed by the private company. This
reflects one of the basic objectives and targets of PPPs in Algeria, i.e. that of procuring through
Public-Private Partnership the know-how and competences for the appropriate and modern
management of infrastructure and services.
As already commented in previous sections, based on publicly available information it appears
that the PPPs implemented so far in the transport sector have been positive. The container
terminal PPP at the Bejaia port is also identified as a best practice example by the International
PPP Centre of Excellence of the United Nations Economic Commission for Europe UNECE
(UNECE, 2017).