PPPs attract capital

Public-Private Partnerships (PPPs), which involve the construction of public projects with private capital, with the investors also managing the projects for a predetermined period, have already drawn proposals for projects worth 850 million euros, Economy and Finance Minister Giorgos Alogoskoufis yesterday told participants at a conference. Interest shown by private investors is being seen as very encouraging by government officials, who hope that infrastructure investment will move ahead without putting undue burden on the state budget. The projects proposed involve schools, prisons, courts and other projects. Specifically, the School Buildings Agency has received proposals to build schools, mainly in northern Greece, budgeted at 500 million euros. Of these, projects worth 200 million have already been approved by the Cabinet, with another 300 million pending. Last Thursday, Olympic Properties SA, the agency managing the Olympic venues – with the exception of the main Olympic complex and the Peace and Friendship Stadium at Neo Faliron – submitted a proposal to build a convention center at Faliron, using private funds. The convention center will be based on the arena that hosted the tae kwon do competition during the Olympics. Olympic Properties’ proposal provides for two private operators: one will refurbish the stadium and the other, a company with experience in running convention centers, will lease it from the first. The General Secretariat for Public-Private Partnerships at the Economy and Finance Ministry has also received several proposals from local authorities, most involving building parking garages. Some local authorities have proposed water and sewage networks and landfills. The ministry is carefully weighing the proposals to determine whether they can be implemented without any contribution from the state budget. Officials say some will soon be approved. Through PPPs, private operators can invest their capital and transfer their know-how to the public sector, Alogoskoufis told the conference participants. He added that the state will also develop its significant property portfolio, a good part of which lies dormant, through PPPs. The international experience with PPPs shows that the countries that have adopted them have benefitted enormously, Alogoskoufis said. «Projects, such as hospitals and schools, can now be built and maintained by private capital. The state undertakes long-term repayment and to ensure (the private operators) observe their contractual responsibilities. Thus, we can develop these projects faster.»