Strengthening the Partnership through NTBs PPPs SAARCCCI CAPACITY
Strengthening the Partnership through NTB’s & PPP’s SAARC-CCI CAPACITY BUILDING WORKSHOP. Tajo Tasha, Thimphu, Bhutan 28 th November 2013 By Nailin Attygalle Secretary General/CEO Federation of Chambers of Commerce & Industry of Sri Lanka
Content Regional context Action to be taken NTB’s in right perspective How to overcome & strengthen the unity PPP approach Sri Lankan perspective Types & benefits of PPP Future of the region through strengthening the partnerships. Nalin. Atty@SAARC-CCI-Thimphu
Regional Context 1/4 th of the world population Accounts for 3% of world GDP Less than 3% of world exports Less than 2% of world FDI Nalin. Atty@SAARC-CCI-Thimphu
Regional Context- 2 Fastest growing economies- Averaging over 6% for last decade. Biggest market place in terms of population Young & Young adult population- 1/4 th are in the age between 15 to 30. Annual income growth averaging 8% Nalin. Atty@SAARC-CCI-Thimphu
Regional Context- Need Action? Are we using our strengths? Statistics, research studies, recommendation and meetings all over. Sleeping giant is going to miss the bus? Need consensus for remedial action Nalin. Atty@SAARC-CCI-Thimphu
Regional Context- Need Action 2 Negative list/sensitive list Trade agreements and MOU’s Entities such as SAARC- In existence and action oriented activities? - outcome to date? Nalin. Atty@SAARC-CCI-Thimphu
Definition of ‘Nontariff Barrier’ A form of restrictive trade where barriers to trade are set up and take a form other than a tariff. Nontariff barriers include quotas, levies, embargoes, sanctions and other restrictions, and are frequently used by large and developed economies. Nalin. Atty@SAARC-CCI-Thimphu
NTB Further Explanation Nontariff barriers are another way for an economy to control the amount of trade that it conducts with another economy, either for selfish or altruistic purposes. Any barrier to trade will create an economic loss, as it does not allow markets to function properly. The lost revenues resulting from the barrier to trade can be called an economic loss Nalin. Atty@SAARC-CCI-Thimphu
NTB’s The Agreement on SAARC has a commitment for reducing tariffs, but has nothing specific to offer with regard to the other complements to facilitating trade. These Barriers are relating to: Testing requirements; Standards; Customs valuation, Labeling requirement; Limitation of land port facilities; Goods delivery/storage. Nalin. Atty@SAARC-CCI-Thimphu
Inter Regional Strategy to Overcome NTB’s Respective country policies Political cultures Too little to offer and rest comes as NTB Regional players unity and understanding Consolidation within the country Build strong partnerships with regional players Nalin. Atty@SAARC-CCI-Thimphu
How to strengthen the Partnerships PPP model It is a paradigm shift Whole world believes it but the implementation issues. It is a challenge for the region Nalin. Atty@SAARC-CCI-Thimphu
Definitions of PPP An agreement between private and public sector agents to undertake a particular project in line with at least one of the two principles below; Joint decision making Joint risk financing Nalin. Atty@SAARC-CCI-Thimphu
Regional Governments Attitude No privatization of government ventures. To use as a political trump Survival strategy CAN WE CHANGE THIS ATTITUDE? ? Nalin. Atty@SAARC-CCI-Thimphu
Sri Lankan Example/Perspective Current Government through its long term policy frame work has clearly stated that the Government does not believe “Privatization” further more and instead private sector is a vital part of economic development and thus it is encouraged to partner the Public entrepreneurial ventures Nalin. Atty@SAARC-CCI-Thimphu
Sri Lanka vs Region All believes no privatization All believes private sector is the engine of the economic growth ONLY WAY FORWARD to OVERCOME NTB’s are PARTNERING LOCALLY & REGIONALLY Nalin. Atty@SAARC-CCI-Thimphu
Types of PPP’s Public provision of collective goods Service provision contracts Outsourcing/contracting Outright privatization Design and construct (D & C) Sale and leaseback Operate and maintain (O & M) Concession Operate maintain and manage (OM & M) Build transfer operate (BTO) Build operate transfer (BOT) Build lease transfer (BLT) Nalin. Atty@SAARC-CCI-Thimphu
Types of PPP’s 2 Build lease transfer maintain (BLTM) Build own operate remove (BOOR) Build own operate transfer (BOOT) Lease renovate operate transfer (LROT) Design build finance operate (DBFO) Build own operate (BOO) Design build finance operate manage (DBFOM) Franchise Joint venture (JV) Regeneration partnership Nalin. Atty@SAARC-CCI-Thimphu
Benefits of PPP Accelerated infrastructure development Faster implementation Reduced whole-life costs Better risk-allocation Better incentives to perform Improved quality of service Generation of additional revenue Enhanced public management Nalin. Atty@SAARC-CCI-Thimphu
Reasons for Implement PPP’s Government’s funding Gap Capacity constraints Benchmarking public sector to the private sector PPP also ensures that cost and time over runs are not born by the government Off Balance Sheet Risk of Cost and time over runs passed to private Company Nalin. Atty@SAARC-CCI-Thimphu
Governments Strategy to Shift The governments should move away from the notion that state should play the leading role in infrastructure development Instead governments should seek greater involvement of the private sector in the development of the country More private public partnerships are encouraged in this regards Nalin. Atty@SAARC-CCI-Thimphu
Governments Responsibility Prepare master plans and enable policy formulation Legislative and institutional reforms Providing common infrastructure Administrative capacity building Identification of thrust areas/zones/ projects Risk assessment and mitigation Facilitate efficient project clearance Ensure transparency and welfare Country promotions and research Nalin. Atty@SAARC-CCI-Thimphu
Private Sector Responsibility Investing into new business opportunities Efficient management of the resources Corporate and social responsibility Ecological sustainability Man power building and training of high quality staff Nalin. Atty@SAARC-CCI-Thimphu
Sri Lanka- Success Stories Sri Lanka Telecom Sri Lanka Ports Authority with SAGT Sri Lankan Airline Regional Plantation Companies Hingurana Sugar Industries Ltd. Nalin. Atty@SAARC-CCI-Thimphu
Why Re-invent the Wheel Region as one team SAARC-CCI as the catalyst- Co-Committee Information portal at SAARC-CCI Dynamic & Vibrant entity SAARC-CCI communiqué to respective governments Nalin. Atty@SAARC-CCI-Thimphu
Derived Outcome Strengthening co-operation Acceleration of infrastructure developments Showcasing the regional power Consolidating the respective economies More employment creation More disposable income to the people Improvement of macro economic indicators Better future for younger generation Nalin. Atty@SAARC-CCI-Thimphu
Role of Governments & SAARC-CCI Governments SAARC-CCI Minimize constrains Strong lobbing, advocacy and recommendations Adopt the right policy, regulatory Institutional reforms Nalin. Atty@SAARC-CCI-Thimphu
Accept the Challenge or Perish We are a strong entity- sleeping-giant Intellectual studies, researches already done We know, ‘where are we today’ We know, ‘where do we want to be’ Challenge is, ‘how do we get their’ POSITIVE APPROACH & ATTITUDE and ALL REGIONAL PLAYERS HAS TO WORK AS CHANGE AGENTS. Nalin. Atty@SAARC-CCI-Thimphu
THANK YOU. Nalin. Atty@SAARC-CCI-Thimphu
Nalin. Atty@SAARC-CCI-Thimphu
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