The National Treasury has planned to tap into the Public Private Partnership (PPP) deals to raise Ksh. 50 billion by June 2025, which is a step in the right direction because the concept enables the public and private players to work together to develop agreed programes and projects. PPP models have been embraced globally since time immemorial for the provision of goods and services, where the first PPP was done in 381 BCE between the indipendent city state of Eretria (modern day Greece), contracted Chairephanes (contractor) to drain L. Ptechai. The contract had modern project finance elements, for example the contractor paid 30 talents to city, was granted exclusive rights over the field reclaimed for cultivation for 10 years and retained the products obtained therein and was tax exempted. PPPs have been used by governments all over the world to bridge the huge financing gap needed for provision of goods and services. According to the African Development Bank (2023), the annual infrastructural financing gap for Africa stands at $130 -170 billion annually. On the other hand, the Bank estimates that the country needs $4 billion sustained annually for ten years for infrastructural financing, which therefore presents an opportunity for the Bank to make money in Kenya and Africa through PPPs.
The government provides legal, institutional, administrative enabling environment for the successful application of PPPs, including setting standards, monitoring and evaluation; while the private sector provides technical expertise, capital, innovation, efficiency, economy and effectiveness in project delivery (the 3E’s) and managerial prowess. The value of PPPs is demonstrated by the fact that between 1990 and 2009, more than 1300 different PPP contracts worth more than 25 billion Euros were implemented globally; where 350 projects attained financial close by 2007; 2,750 infrastructure projects valued at US$ 786 billion, were financed through PPPs between 1990-2003 worldwide. The World Bank notes that 135 countries are actively using PPPs in diverse areas of economies, 15 countries in East Asia & Pacific region, 21 countries in Europe and Central Asia, 18 countries in Latin America and the Caribbean, Middle East and North African Countries (MENA), 12 countries, South Asia, 6 countries 34 countries in SSA, 29 countries in OECD. Application of PPPs in Kenya has been hampered by inadequate local skills and capacities to structure, arrange and finance PPP models and projects so that Kenyans can get proper Value for Money (VfM). The uptake of PPPs has been low despite its role in addressing financing, technological, innovation, VfM and effectiveness of projects in the country. This calls for administrative, legal, regulatory, institutional support for PPPs, in addition to thorough research, teaching and publications/publicity on PPPs. Dr Giti is an urban management, public – private partnerships (PPP) and environment specialist. mutegigiti@gmail.com , @danielgiti
Dr. Daniel Mutegi Giti 