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Risk Management in Transport PPP Projects

In the Islamic Countries

249

Follow up

As mentioned, many of the PPP initiatives in the transport sector are at the early stage of their

life-cycle with many projects under construction and others at the beginning of their operation

period. Several PPP dedicated teams within the procuring authorities and supervisory bodies of

the Turkish administration have been set up which have gained substantial experience in the

development and implementation of PPP projects in their respective fields of operation. The

Turkish Authorities consulted for this study report that this experience is the outcome of a

learning by doing approach

. The Eleventh Development Plan of the Republic of Turkey

foresees the further

strengthening of the capacity

of the Turkish administration in the

management and supervision of PPPs. This also appears to include training and capacity-

building initiatives.

A systematic reporting system is already in place in Turkey that is based on the elaboration and

transmission of monitoring reports issued by the contractors to the procuring authorities and

by the latter to the Presidency of Strategy and Budget (PSB). The monitoring system in place

between the contractors and the procuring authorities is focused on the performance of the

individual projects, whereas the one in place between the procuring authorities and PSB is

ultimately related to the control and of the liabilities and fiscal risks of the PPPs in the wider

framework of the management of the state budget. Accordingly, reporting procedures seem to

be more structured regarding the transmission of financial-related information than on the

other elements of the PPP contracts. As part of this risk management practices a

fiscal risk

bulletin

in a form of a quarterly internal report, specific to PPP projects is also prepared by the

Ministry of Treasury and Finance, which is however limited to those BOT schemes involving

loans subject to debt assumption agreement [i.e. Eurasia Tunnel Project, Odayeri-Paşaköy

Section (including the Third Bosphorus Bridge) of the Northern Marmara Motorway, Gebze-

Orhangazi-İzmir Motorway (including the Izmit Gulf Crossing and access roads), Northern

Marmara Motorway- Kınalı-Odayeri Section, Northern Marmara Motorway - Kurtköy-Akyazı

Section, Çanakkale-Malkara Motorway (including 1915 Çanakkale Bridge), Ankara-Nigde

Motorway]. The Ministry of Treasury and Finance is also publishing monthly and annual Public

Debt Management Reports, including details on the same assets (Ministry of Treasury and

Finance, 2015).

As commented in previous sections a

more systemic and structured reporting activity

could

be implemented concerning all phases of the project life-cycle of the PPPs and including

information on all PPPs. A database appears to be already in place under the responsibility of

the Presidency of Strategy and Budget (PSB), which according to the reforms assumed by the

Eleventh Development Plan of the Republic of Turkey may become a monitoring tool to be used

for risk management purposes providing inputs in terms of best practices or lesson learned as

well as ex-post evaluation activities.