Risk Management in Transport PPP Projects
In the Islamic Countries
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Table 18: Takeaways, barriers and options related to the pre-tender phase
Key Takeaways
 Value-for-Money considerations are an essential step in the pre-tender phase.
 Feasibility studies focused on issues of critical importance in PPP contracts are essential for the
preparation of robust PPP tender procedures.
 It is important to identify early critical project-specific capacity gaps in public sector parties.
 Soft market testing can be an essential step to prepare tender design and pre-identify stakeholders
likely to play important role in successive phases.
Barriers/trade-offs
 Barriers on skills and organizational resources may be highly specific.
 Trade-off between investing more time and resources and urgency in delivery (likely to affect
many aspects of the decision process, including VfM considerations).
Scope for parallel strategies
 Based on composition and nature of project pipeline it may be possible to work in parallel on pilot
investments and institutional capacity-building.
Source: Authors.
Phase 3: Procurement and contracting
The management of the tendering phase is essential in PPPs, since tendering procedures in
PPP operations are generally more complex than those applied in conventional public
tenders. Poorly managed tenders are unlikely to produce good offers. The quality of tender
documentation is likely to be critical in widening competition and attracting good offers, giving
more opportunities to reduce overall risk vulnerability for the public sector.
It is essential to decide on the most appropriate procurement procedure (e.g. open,
restricted, competitive dialogue…) and analyze the trade-off between simpler procedures and
more complex ones, which may ultimately bring about better offers. This may prove to be
technically difficult and it is important that a capable tender management team is put in place
in order to manage complex procedures and embed in the tendering process – which in many
cases may be multi-phased and long-lasting – incentives that may mitigate risks.
The following Box illustrates a good practice coming from the Chilean experience with respect
to a prequalification procedure which takes place before tendering.