Public-Private Partnership

The overall objective of this project is establishment of functional systems of Public Private Partnership at all levels of authority in BiH in accordance with the European legislation, European Standards and the best European practices.

Thus defined goal is simultaneously compatible with the key objectives of the Action Plan 1 of the public administration reform in the area of Public Finance:

PF 7. Development of public private partnership

Purpose of the Project

The purpose of the Project is:

i.             development of legislation in the field of Public Private Partnership, and harmonisation of the already existing legislation related with the field of PPP in BiH

ii.            training and capacity building of the relevant institutions for implementation of PP, and preparation and possible implementation, to the extent possible, of 2 or more pilot PPP projects (training at work);

iii.           Training of the private sector on the possibilities for business within the PPP concept, and creation of a favourable business environment for business entities within the PPP concept;

iv.           Education of a wider public on the advantages provided through an efficient PPP

Brief Description

Necessary investment projects related to the infrastructure and social projects cannot be financed only from the budget funds. Limitation of budget funds is an imperative imposed by the economic situation and the pressure by the IMF. Public-private partnership enables financing of big public investments in part by private funds. Also, allocation of risks is being made, there is more efficient management of projects by using know how and methods from the private sector, and finally, economic growth and provision of better services to citizens.

The project will create legal preconditions for Public Private Partnership, at the levels where those preconditions still do not exist. Since BiH aspires to enter the EU, all legal solutions, existing ones and the future ones, will be harmonised with the EU legislation. All the existing EU legislation on PPP will be explored and transposed in the legislations at the appropriate level of authority in BiH. That especially applies to the “Procurement Directive”, “Directive 2004/18/EC on Public Works and Services Concessions”, “Utilities Directive 2004/17/EC”, “EU Green Paper on PPP (Green Paper on Public-Private Partnerships” i “Community Law on Public Contracts and Concessions, COM (2004) 327 final)”, “European Commission Interpretative Communication on Institutionalised PPP, C(2007)6661″ and the concept of competitive dialogue introduced in “Directive 2004/18/EC” as well as other relevant EU legislation, standards and principles related with the PPP.

In Bosnia and Herzegovina, there is a certain number of laws and legal regulations regulating this issue. In the Republic of Srpska and the BD, there are the laws on PPP. These laws have been adopted and their implementation started. At the level of the Federation, there is the draft Law on PPP, drafted by the Federal Ministry of Transport and Communication, but it was returned by the Government of the Federation.  At the level of BiH, there is no law on PPP, but there is a need for it. There are laws on concessions.

In the PPP project, the contract implementer is to closely cooperate and coordinate with all the institutions, Project beneficiaries, as well as with the business and the financial community The project is to create a wish of the business community to participate in the PPP and invest in the infrastructure. Also, the financial community is to be ready to finance the PPP. In order to test a success of the project, it has been foreseen to design and implement 2 pilot PPP projects (one in the FBiH, the other in the RS), to the extent possible.

Comprehensive capacity building for various levels of the institutions of BiH and the business community is one of the three key components of this project, in order to ensure learning, establishment and sustainability of the concept of PPP through trainings at work, mentoring, seminars, study trip, etc.

The promotion is the third component of the project, which needs to ensure acceptance of the PPP concept by the institutions and the business community.

The indirect beneficiaries of the project are all other institutions dealing with the PPP, such as ministries of trade at all the levels, the Foreign Investment Promotion Agency, etc., chambers of commerce at all the levels, and the whole business community.