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P AFTER P AFTER P AFTER P by Dr. Godfrey Vincent

posted 11 Jul 2012, 22:18 by Gerry Kangalee   [ updated 11 Jul 2012, 22:20 ]
Shaq’s visit to Trinidad and Tobago and the “Hoop for Life” program is not a co-incidence. It has nothing to do with solving crime on the Beetham and by extension Success Village and Laventille. Rather, it is a new test run of applying the public private partnership (PPP) which is part of the PP’s privatization thrust.

The question we have to ask is not why Shaq came to our shores but who paid for his visit. Whether or not the government wants to mystify this initiative, the one thing that is clear is that from the 2013 budget onward the PP government will embark on a program of implementing PPP on an extensive scale in Trinidad and Tobago. What is this Public/Private Partnership?

Public-private partnership (PPP) is a funding model for a public infrastructure project such as a new telecommunications system, airport or power plant. The public partner is represented by the government at a local, state and/or national level. The private partner can be a privately-owned business, public corporation or consortium of businesses with a specific area of expertise.

PPP is a broad term that can be applied to anything from a simple, short term management contract (with or without investment requirements) to a long-term contract that includes funding, planning, building, operation, maintenance and divestiture (sale of government companies). Different models of PPP funding are characterized by which the partner is responsible for owning and maintaining assets at different stages of the project. Examples of PPP models include:

Design-Build (DB): The private-sector partner designs and builds the infrastructure to meet the public-sector partner's specifications, often for a fixed price. The private-sector partner assumes all risks.

Operation & Maintenance Contract (O & M): The private-sector partner, under contract, operates a publicly-owned asset for a specific period of time. The public partner retains ownership of the assets.

Design-Build-Finance-Operate (DBFO): The private-sector partner designs, finances and constructs a new infrastructure component and operates/maintains it under a long-term lease. The private-sector partner transfers the infrastructure component to the public-sector partner when the lease is up.

Build-Own-Operate (
BOO): The private-sector partner finances, builds, owns and operates the infrastructure component in perpetuity. The public-sector partner's constraints are stated in the original agreement and through on-going regulatory authority.

Build-Own-Operate-Transfer (
BOOT): The private-sector partner is granted authorization to finance, design, build and operate an infrastructure component (and to charge user fees) for a specific period of time, after which ownership is transferred back to the public-sector partner.

Buy-Build-Operate (BBO): This publicly-owned asset is legally transferred to a private-sector partner for a designated period of time.
Build-lease-operate-transfer (BLOT): The private-sector partner designs, finances and builds a facility on leased public land. The private-sector partner op
“We believe there is a great opportunity to search for model of finance in public private partnership. We may need to give it a Caribbean name.
 
To that end we have begun the preparation by establishing the unit in the Ministry of Finance to undertake what is required to promote this new area of opportunity.

We went further we put into place in the last budget the proposal for the establishment of the Tourism development fund with particular reference to Tobago to encourage greater resilience to the Tobago part of the economy to the onslaught they face as a result of the global situation.

We embarked on innovative ways for capital market development by encouraging smes. We have begun work on public offerings of state enterprises. During the course of this year we have identified a further seven enterprises to list on stock exchange.”

Winston Dookeran on Public Private Partnership (P3) at the Hyatt on Tuesday November 1st, 2011

erates the facility for the duration of the land lease. When the lease expires, assets are transferred to the public-sector partner.
Operation License: The private-sector partner is granted a license or other expression of legal permission to operate a public service, usually for a specified term. (This model is often used in IT projects.)

Finance Only: The private-sector partner, usually a financial services company, funds the infrastructure component and charges the public-sector partner interest for use of the funds (The Canadian Council for Public-Private Partnership, 2009). 

In every major city in the United States, this model is being implemented. These initiatives came out from the CATO institute and the Heritage foundation, think tanks that support privatization. Today, this model has become policy of the IMF and the World Bank, and has become an integral part of Structural Adjustment policies that are forced on countries of the Global South. 

The problem with PPP is that the state becomes for sale and Democracy (with a small “d”) is manipulated by the elite/corporations. Because these entities are able to donate huge sums to finance political parties, they, in turn, are given massive tax breaks and sometimes influence the direction of public policy regarding education (charter schools), sports, transportation and energy. Moreover, public private partnerships have the ability to turn once public places into private spaces. 

The Minister of Tourism has his eyes set on Maracas. Don’t be surprised if an announcement is made that foreign developers will be given access to construct hotels and up-scale condominiums on the beach. Furthermore, these initiatives pit private sector workers against public sector workers and further weakens the trade union movement. Moreover, as in the case of the Hoops program on the Beetham, it lures the residents into a false sense of security in the belief that sporting initiatives can solve all of its ills. Beware of the P(rivatization) word; the PP and the PPP. 
 
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