Public-private partnerships (PPPs) have helped many emerging market countries modernise their highways and telephone networks and build new power plants.

However, the PPPs that have been effective in building infrastructure have not translated well into projects involving public services, as most Middle East and North Africa (Mena) countries still lack the necessary institutional capabilities for an effective outsourcing of public services to the private sector.

Now, a new model of partnership is emerging that may transform how public services projects are structured, according to a new report by Booz & Company.

'New joint ownership arrangements create new companies and introduce completely new services - those the government wants to provision in partnership with the private sector,' said Booz & Company partner George Atalla.

'The government and its private partners build the service from the ground up, sharing the benefits and risks in ways that work for both sides, without being burdened by the mistakes of the past.

'In recent years, Mena countries have invested heavily in their transportation, telecommunications and energy infrastructures,' he said.

'These infrastructure projects have tended to be fairly standard and therefore Mena governments have been able to turn to global companies outside the region to help them.

'However, the region's governments have not been anywhere near as successful at using public-private partnerships to execute public-services projects.

'In most countries in the Mena region, the environment for such partnerships is unsophisticated and therefore few successful non-infrastructure outsourcing initiatives have taken place,' he added.

'In addition, private sector companies in the Mena region generally don't have the required experience that would set them up to handle public services projects.

'Few Mena governments have hired programme managers or developed the human capital necessary to run outsourcing programmes that rely on skills in procurement and project management,' he said.

'In emerging markets where there is a dearth of suitable private partners to take on public services projects, joint ownership can be expedient,' he added.

However, joint ownership should always be regarded as a temporary solution, never as a permanent one, he said.-TradeArabia News Service