Public Private Partnerships in Post- Conflict-Reconstruction

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1 Public Private Partnership (PPP) Public Private Partnerships in Post- Conflict-Reconstruction "Private Sector Development and Peacebuilding Exploring Local and International Perspectives Berlin, September 14-15, /09/2006 Seite 1

2 Content - Introduction PPP - Reasons for FDI - Conflict Cycles and Potential for PPP - Example of a PPP-Project -Conclusion 20/09/2006 Seite Page 2

3 ODA does not suffice to meet challenges FDI and ODA in developing countries in billion US $ FDI ODA /09/2006 Seite Page 3

4 Synergies Point of view of development cooperation of the company Initial situation Social, economical and ecological challenges in the developing country cannot be managed by governments alone Basic conditions for investments in developing countries cannot be improved by private companies alone Factors Mandate/Mission in development cooperation Professional and regional knowhow Financial and personnel resources Business interest Sector-specific know-how Financial and personnel resources Results Joint projects can be realized more cost efficiently and effectively while sustainability is ensured 20/09/2006 Seite Page 4

5 Development Cooperation PPP Business Win-Win-Win Situation Advocacy Developing norms and standards Sharing and coordinating resources and expertise Harnessing markets for development 20/09/2006 Seite Page 5

6 PPP Projects* Number of PPP-Projects 661 Sub-Saharan Africa 157 Asia 197 Latin America / Caribbean 144 Middle East / Eastern Europe 151 Supra-regional 12 Approx. 89 m. public contribution Approx. 164 m. private sector contribution *June 2006, PPP-Funds & Integration 20/09/2006 Seite Page 6

7 Motivation for FDI Resources (Oil) Costs (Textile) Markets (Chemicals) 20/09/2006 Seite Page 7

8 PPPs and phases of conflict Sustained violent conflict Phases of Conflict Unstable Peace/ Latent Conflict Stable Peace Outbreak of violence Stalemate/deescalation/ceas efire Return to unstable peace/latent conflict Settlement/ Resolution Crisis Prevention Conflict Management Post-Conflict Reconstruction Duration of Conflict Source: adapted from International Alert (2005): Conflict Sensitive Business Practice: Guidance for Extractive Industries 20/09/2006 Seite Page 8

9 Time Frame for Post-Conflict-Reconstruction Conflict Emergency Aid Transition Phase Development Phase (1-2 years) (1-3 years) (4-10 years) Source adapted from: Center for Strategic and International Studies (2002): Framework of Post Conflict Reconstruction 20/09/2006 Seite Page 9

10 Example: Qualified employment for the local population in Afghanistan Partner: Heidelberger Druckmaschinen AG Problem Slow Post-War investment Lack of qualified employment Project Construction of a centre for print and prepress Qualification of skilled local labour Impacts New qualified labour force Project of reference & market access for Heidelberg Demand for printing jobs can be met locally 20/09/2006 Seite Page 10

11 Summary - PPP is a successful and important tool of development cooperation - In zones of conflict PPP is not the one size fits all answer to attracting private sector development and kick-start economic development: It is not applicable during violent conflict It is suitable for preventing violent conflict by adressing the root causes of conflict The strength of the PPP-tool lies in Post-Conflict- Reconstruction, specifically in narrowing the gap between the emergency phase and the phase of increased private investment It can make an important contribution to prevent the relapse into violent conflict 20/09/2006 Seite Page 11

12 Public Private Partnership (PPP) Public Private Partnerships in Post- Conflict-Reconstruction "Private Sector Development and Peacebuilding Exploring Local and International Perspectives Berlin, September 14-15, /09/2006 Seite Page 12