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Amb. Robin Renee Sanders

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The Value, Role, & Impact of Public-Private Partnerships for Africa's Development

Posted: 03/ 6/2012 2:31 pm

FEEEDS, FE3DS series

What is a Public-Private Partnership (PPP) and what value does this development paradigm have for Africa? Public-private partnerships (PPPs) can take many forms, and can be projects and programs not just with the private sector. PPPs are one of the more innovative ways to address development, economic growth, unemployment and training (particularly for African youth, and women), and also can serve as a better mechanism to assist both African Small and Medium sized Enterprises (SME's), as well as a more propitious way to engage the dynamic African Diaspora. Traditionally, PPPs in general are defined as an agreement (Memorandum or Contractual) for resources (financial and human, or a mix) between private and public sector entities. Organizations like the National Council on Public Private Partnerships (NCPPP) says a PPP exists through an "agreement [when] the skills and assets of each sector (public and private) are shared in delivering a service or facility for the use of the general public ... including sharing the risks and rewards in the delivery of the service or facility."

Although we are seeing a lot of improvements in the types of PPPs, there remains a lot more room for improvement and creating non-traditional PPPs. For Africa, as long as donors have been in the development game, many (not all) of the past development models have produced little-to-no sustainable success nor provided a lot of long-lasting results that fundamentally changed peoples' lives and country challenges.

For Africa today, changing peoples' lives is so critical, especially given the future demographics that are on horizon there. In using the year 2050 as a pivotal timeframe or value proposition year, let's look at a few of the looming stats on Africa's population and where the critical fault lines are, which will call for more and different types of development executed at a faster pace:

  1. Africa will be the most populous continent in the world, with a population of over 2.1 billion;
  2. Youth workforce between the ages of 15-34 will be in excess of 1.1 billion -- surpassing China and India's workforce;
  3. Between now and 2050, nearly 3 million new people become new entrants onto the continent's poverty matrix;
  4. Africa will see its middle class continue to grow at a rate of 34.3% or more, possibly tripling its current 313 million middle classers;

Therefore what are the best development paradigms to assist the African public and private sectors and their communities with these key demographic issues? PPPs are a way to help, but we must get the right mix when creating them so they are not one-off wonders.

So let's start with widening our PPP lens as to what a PPP is and be more creative about the players and the types.

Let's Add Another P to the PPP Paradigm:

Innovation, Cutting-Edge Thinking, Adding New Players

Innovation -- New partnerships need to be created, particularly with SMEs, MMEs (enterprises with less than 10 people), and the African Diaspora. A good example of this is the African Diaspora Market Place project, or ADM. ADM is a new partnership which includes NGOs, a U.S. private sector company and its foundation, and USAID focusing strictly on helping and providing grants to Diasporan SMEs.

Cutting-Edge Thinking -- A number of creative programs are cropping up such as: the General Mills-USAID effort using PEPFAR-HIV/AIDS monies to increase capacity of African food companies; International Finance Corporation's (IFC) work with the Nigerian State of Cross River addressing hospital delivery services, and the International Fund for Agricultural Development's (IFAD) work in Kenya on small farm holder horticulture projects.

Adding New Partners to the PPP Matrix -- Stepping out of the traditional public-to-private sector framework, PPPs today should and can look quite different. In fact we should be expanding the model more to include:

A.) Public Sector-to-Public Sector: Partnerships between in-country public sector entities or a public-to-public sector project where a cross-fertilization of budget resources among public sector entities can be used for a synergistic program. For example, Housing and Power Ministries could combine parts of their budgets to provide affordable, energy-efficient housing. In this case, the African public sector entities are both donor and stakeholder.

B.) Donor-to-African sub-sovereign: Donor partnerships that are directed to states/districts/parishes with in a country, or toward municipalities, or community governments -- basically any governing body below Federal. Some donors are just beginning to look at this, particularly if there is good governance by local leadership.

C.) NGO-to-public sector: NGOs should begin to look more at working with any of the sub-sovereign public entities noted above, particularly in the area of community training -- keeping in mind that partnerships also can include community in-kind contributions.

D.) NGOs-to-private sector: This is an area where Africare is leading the way as we have a number of private sector partnerships. Africare's $1.5 million Coke Cola Company-funded South African HIV/AIDS clinic; our work with ExxonMobil to assist Chad women making shea butter; policy seminars with Chevron; and, a Benin water-sanitation project for schools with African vocalist Angelique Kojo, are just a few examples of innovative efforts, cutting-edge thinking, and adding new partners to the PPP paradigm.

What are the Positives of PPP and PPPP's:

So maybe we need 4 P's (PPPP) -- or a quadruple P -- instead of just three to describe these new kinds of partnerships, but what are the challenges to success? For success, the following elements are critical: the right mix of partners, risk-sharing, sufficient resources, agreed upon outcomes, leadership commitment, and above all stakeholder buy-in/contribution. What does this mean? Fundamentally, a positive outcome is unlikely if somewhere along the partnership link noted above there is (to use a common phrase differently) a value chain problem. For example, my team in Nigeria and I moved some of our partnership efforts to the sub-sovereign level, meaning working with several of Nigeria's states on specific sector development in both agriculture and education. In some cases we had great successes, and in others not because one or more of the links in the PPP value chain failed.

In the end, the partners have to believe in each other, know each other well, and be willing to make project adjustments as needed in order to move past the one-off wonders, and truly add more value and impact to the PPP development paradigm for Africa so that by 2050 sustainability can be achieved.

 

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