Risk Management in Transport PPP Projects
In the Islamic Countries
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states that the contract shall include, among its many elements, provisions on the financial,
technical, and administrative supervision of the project, as well as the requirements for the
report relating to monitoring activities.
Box 33 KPIs and monitoring in the QAIA and ACT cases
The QAIA project is monitored by an ad-hoc unit within the Ministry of Transport, i.e. the QAIA
Project Management Unit (PMU). AIG has to provide full annual financial statements as well as
quarterly financial and operational reports.
In terms of performance metrics, the PPP contract foresees that the operator should maintain a
certain level of quality in running the airport. As such, no specific KPIs triggering contractual
obligations are foreseen, leading to a contract structure characterized by simplicity and,
according to interviewed stakeholders, to a mature relationship between PPP partners. The
simplicity of the contract, according to this line of reasoning, contributes to maintaining a good
cooperation, as the monitoring activities do not focus on many minor details and are thus not
invasive, but can rather focus on the bigger picture.
In addition to PMU, monitoring tasks are also performed by an independent third party (a Jordan
company with a strong engineering and management background and international experience).
In the ACT case, ADC performs monitoring tasks based on KPIs included in the concession
agreement, which have by now partly become outdated. For instance, one KPI is “time for a vessel
to berth”: by now, this indicator includes the performance not only of the terminal operator
(APM) but also of a second company. As such, it cannot be used to monitor APM’s work. ADC also
performs regular audits and APM provides monthly financial and operational reports.
However, APM is subject to strict monitoring along internal KPIs of the MAERSK group as well.
These KPIs are reported to be more stringent than the contractual ones and to include
benchmarking exercises with the numerous other terminals managed by the group worldwide.
As such, APM is under stronger pressure from internal monitoring activities than from
contractual obligations: this consideration is in line with the overall rationale of PPPs, i.e. to
involve quality experts in a service delivery project, who may build on a strong track record and
ever-improving working procedures.
Remuneration
In light of the small number of transport PPP projects which have been implemented in Jordan,
it is difficult to identify recurring patterns in remuneration schemes. In fact, remuneration
schemes appear to be project-specific.
Box 34 Remuneration in the QAIA case and in smaller ASEZA PPP projects
AIG is remunerated through the revenues it raises from operating the airport. Under the terms of
the 25-year concession, the national government retains ownership of the airport and receives a