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The UN Centre for Trade Facilitation and Electronic Business (UN/CEFACT) approves a new Recommendation on Public-Private Partnerships in Trade Facilitation

Published: 23 February 2017

The port of Aqaba, Jordan’s only sea port, was reformed in 2004 through a public-private partnership (PPP), which helped to reduce average port stays from 8 days to a few hours. Port productivity has more than tripled and the cost to export per 20-foot container dropped from USD 720 in 2004 to USD 680 in 2007. The Senegalese Single Window – ORBUS – was established under a PPP in 2004. As a result, the time required to complete preclearance formalities for an import or export operation has been reduced by 70%, from 4 days to half a day. Furthermore, the amount of Customs’ revenue collection went up from USD 625 million in 2005 to more than USD 1 billion in 2008. 

Examples like these could blossom in coming years thanks to the development of a Recommendation (N.41), describing the key components and best practices for PPPs in Trade Facilitation, by the UN Centre for Trade Facilitation and Electronic Business (UN/CEFACT). Based on success stories and lessons learned from traditional PPP projects, the Recommendation provides detailed guidance on specific aspects, such as the governance, supporting information technology and infrastructure, and potential risks to consider in project implementation. It also shows potential benefits of PPPs in Trade Facilitation, in terms of enhancing open and transparent markets, bringing cost-effective processes through more effective service delivery, increasing competition and even attracting foreign investment.

Freely available to government authorities and businesses worldwide, the Recommendation will help them implement state of the art Trade Facilitation projects such as Single Window systems, creation of National Trade Facilitation Bodies, infrastructure support for port communities, trade and transit corridors, and coordinated border management.

Public-Private Partnerships (PPPs) are a possible solution for financing and delivering critical public services. In 2015, the total investment in transport projects with private participation in emerging countries was estimated by the World Bank at US$69.9 billion, up 53 percent from the average of the previous five years.  
The Recommendation has been approved by the UN/CEFACT Heads of Delegations and will be submitted to the 23rd UN/CEFACT Plenary (3-4 April 2017). 

The recommendation is available at: http://www.unece.org/index.php?id=45379 

Note to editors

Selected examples of PPPs in Trade Facilitation

Private sector investments in seaports have led to increased throughput and frequency of transport services, resulting in lower freight rates and improved connectivity. New private sector investments in ports have also improved the connections to the global liner shipping network, including in Djibouti (after investment from Dubai-based port operator DP World), Lebanon (benefiting from port reforms since 2006) and Morocco (with a new international transhipment facility in Tangier).

PPPs are largely successful in achieving their development outcomes. According to the development outcome rating of project evaluations, more than two-thirds of PPPs are successful. The 176 PPPs supported by International Finance Corporation (IFC) show very high development outcome ratings, with 83 percent rated satisfactory or better.

The use of PPPs has increased in the last two decades. PPPs are now used in more than 134 developing countries, contributing about 15–20 percent of total infrastructure investment.

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