With about $3.4tn of projects planned across the Middle East and North Africa (mena), there is no shortage of potential for business and investment opportunities in the region’s projects market. The challenge facing the region is one of finance.
Over the past five years, since the collapse of oil prices in 2014, government finances have been severely compromised by reduced oil export revenues. Since 2014, regional spending on projects has contracted as finance ministries implement austerity measures to limit debt and deficit growth.
A turning point was supposed to come with an anticipated recovery in oil prices in 2020. Instead, the region’s fiscal challenges have multiplied as the Covid-19 pandemic triggered a new slump in oil prices accompanied by a collapse in key non-oil sectors such as travel, tourism and retail.
Governments are increasing borrowing and drawing down on their financial reserves to finance their spending but the long-term fiscal legacy of Covid-19 is that region can no longer afford to directly finance all of the huge infrastructure projects and public services needed to meet the needs of a growing population and expanding industrial base.
A change in approach to project financing is required and right at the top of the agenda is PPP.
On paper, using public private partnerships (PPP) to lever in the financial and technical capabilities of the private sector to design, build, finance and operate public services for an extended period offers a readymade solution.
However, PPP has had a challenging history in the Mena region. The private finance of electricity and water infrastructure is well established and has been very successful for over three decades through independent power and water projects (IPWP). But outside the electricity and water sector, PPP has largely failed to gain significant traction despite efforts by governments over the past 10 years.
In markets such as Egypt, Kuwait and Oman, dedicated bureaus have been set up to plan and deliver programs of PPP projects however the lack of intuitional capacity and commercial track record as well as, in some cases, political disagreements, has served to undermine progress.
But with the impact of Covid-19 in the first half of 2020 there is now more alignment in the desire to deliver successful PPPs across the region and it is likely that in the coming years there will be a rapid acceleration of PPP projects delivered across the Middle East and North Africa.
As countries seek to tap private investment capital, governments are moving hastily to prepare PPP legislation and regulatory frameworks, while at the same time drawing up significant pipelines of projects to take to the market.
And the need make progress will also see increased focus on offering commercially attractive projects that balance of risk allocation and reward between the public sector project sponsor, and the private sector developers.
PPP in the Middle East and North Africa 2020 is the latest research report from the MEED Insight Team.
It provides a comprehensive review of the market for PPP projects and privatisation across the region. The report looks at the planned programmes of PPP projects and privatization initiatives in each country and considers the opportunities for investors as well as the challenges for delivery.
PPP in the Middle East and North Africa 2020 is a high value resource for anyone seeking to understand the direction of the projects market in the ME post Covid-19, and will help identify new and potential business opportunities for investors, consultants and contractors alike.
The report is being launched to coincide with MEEDs pioneering PPP in the ME virtual conference, MENA PPP Virtual Think Tank, which brings together leading figures in the regions PPP and privatisation community to identify the way forward PPP in the ME.
- Comprehensive review of PPP in the Mena region
- Country-by-country analysis of PPP opportunities
- 16 markets covered
- 190-page report in pdf format
- Comprehensive listings of planned PPP projects
- Updated for the impact of Covid-19
- Exclusive MEED report with special discount for PPP conference attendees
- Up-to-date insights from MEED’s team of regional expert
- Latest market data from MEED Projects
All the MEED Insight reports are delivered in digital format.