Press Release ECE/TRADE/00/4
Geneva, 7 April 2000
Public-Private Partnership in Infrastructure: UN/ECE BOT Group
works with ESCAP to alleviate poverty in Bangladesh
On February 15–17, a group of
consultants forming a delegation from the Build-Operate-Transfer Group (BOT Group) of the
United Nations Economic Commission of Europe (UN/ECE), which is based in Geneva,
participated in a three-day conference in Dhaka, Bangladesh covering the subject of
public-private partnerships ("PPPs") in infrastructure development, together
with their counterparts from the United Nations Economic and Social Commission for Asia
and the Pacific (ESCAP), which is based in Bangkok. The conference was jointly sponsored
by the Board of Investment (BOI) of the Government of Bangladesh, UN/ ECE and ESCAP.
Representing the BOT Group in Dhaka were: Geoffrey Hamilton, Secretary of the Group; Tore
Wiwen-Nilsson, a lawyer with the law firm of Manheimer & Swartling in Malmö, Sweden;
Barry Metzger, a lawyer with the law firm of Coudert Brothers in New York City; and
Stanley Park, also a lawyer with Coudert Brothers; Graham Rowcroft, a senior
representative from the United Kingdom’s Department of Trade and Industry; and
Michael Dymacek, Chief Executive Officer of BIP Ltd, Brno, Czech Republic.
One of the central items of attention for
the conference was a Negotiation Platform prepared by the BOT Group. The Negotiation
Platform is a document summarily discussing and analyzing the main issues involved in a
PPP, explaining such issues and the various related public and private sector interests.
The purpose of the Platform is to educate Bangladeshi government officials in negotiating
PPPs more effectively. The thought behind the Platform was that a better understanding of
PPPs, their terms and conditions and the various interests underlying such terms and
conditions would enable government officials to negotiate more knowledgeably, to the
ultimate benefit of all parties involved.
The first day of the conference focused on
the current legal and regulatory framework in Bangladesh for BOT infrastructure projects.
The second day was devoted to the presentation of the Negotiation Platform by Messrs.
Nilsson, Metzger and Park. On the third day, the Government presented a
"showcase" of various projects currently contemplated for development, including
an elevated railway project and a toll road.
Mr. Hamilton commented, "through
harnessing private sector funding, PPPs enable projects to proceed with little or even no
capital expenditure by the host Government. This can have the effect of easing the debt
burden of Bangladesh and releasing public resources for poverty alleviation. It is still a
new concept in Bangladesh and it is important that this country
avoids some of the problems that have
arisen in other Asian countries. The objectives of the UN/ECE BOT Group are to advise
Governments on the best mechanisms for implementing PPPs with a focus on the countries of
central and eastern Europe and the CIS. The cooperation, however, with ESCAP and the
Government of Bangladesh demonstrates that the business of project finance has become
truly global and various regions of the world have much to learn from the experiences of
others."
Mr. Metzger added, "Notwithstanding
the country’s relative poverty, the Government has shown significant potential for
developing infrastructure on a BOT basis and, in fact, has achieved in its first BOT
project what has taken other developing countries years to attain: that is, a successful,
competitively bid process for awarding BOT rights. Given the current desire of the
Government to encourage foreign investment and the significant need for infrastructure in
the country, I think that the BOT model could very well play a significant role in this
country’s future development of infrastructure."
The BOT Group, at the end of the
conference, submitted a list of recommendations to the Government of Bangladesh. The
recommendations included the following: (i) improve the legal framework for PPPs by
enacting a new concession law; (ii) establish a special facilitation unit for promoting
PPPs within the public administration; (iii) build capacity within the public
administration to deal with PPPs; and (iv) increase the visibility of the country as an
attractive investment environment.
Mr. Park noted, "The Government of
Bangladesh should be given credit for having already taken significant measures in support
of increasing foreign investment, in general, and promoting BOT project financing, more
particularly, but considerable further progress needs to be made in order to provide the
kind of environment that will be most conducive to fostering public-private partnerships
sufficiently to materially alleviate the country’s infrastructure shortage."
The February conference was the result of
planning initiated last October 1999, at which time Messrs. Hamilton, Nilsson and Park
travelled to Dhaka to participate in a preliminary conference on PPPs, also sponsored by
the BOT Group and the United Nations. At the October conference, the participants agreed
that the Negotiation Platform should be used to train and to enhance the capabilities of
the Bangladeshi public sector in negotiating PPPs.
For more information, please contact:
Geoffrey Hamilton
Regional Adviser for Trade and Investment Promotion
United Nations Economic Commission for Europe
CH - 1211 Geneva 10, Switzerland
Tel: (+41 22) 917 28 38
Fax: (+41 22) 917 00 37
E-mail: [email protected]
Web site: http://www.unece.org/trade/ctied/tradedir/trddir_h.htm
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