On Challenges of Developing PPP in Central Asia, delivered by Jannat Salimova-Tekay, Head of Project Finance and Infrastructure, EY in Central Asia and Caucasus

1. “Attracting private investment through public-private
partnerships” forum
Bishkek,
January 21, 2015
Challenges to implementing PPPs in
Central Asia
Presenter: Jannat Salimova-Tekay,
Head of Project Finance and Infrastructure Group in Central
Asia and Caucasus
Senior Manager at Transaction Advisory Services (TAS), EY

2. 2
Goal and plan
Why do governments choose PPP
approach (e.g. fiscal
considerations, technology
transfer, development of financial
markets)? There should also be a
pipeline of projects that meet
those goals.

3. 3
Rush and inadequate timing
Unrealistic schedules result in
failed tenders. Repeated tenders
erode investors’ interest.
Insufficient competition leads to
government overpaying.

4. 4
Risk sharing: optimal not maximum
Most governments try to transfer
risks that are not natural to
private parties. Attempts to
mitigate them by private parties
result in higher whole-of-life
costs. This leads to government
overpaying.

5. 5
Institutional capacity
All countries of Central Asia are
yet to complete their successful
PPP transactions. There is no
experience within governments
on such projects. Therefore, first
projects will need to rely heavily
on experienced consultants.

6. 6
Most projects will depend heavily
on long-term financing. In most
countries of the region local
currency debt is severely scarce.
Hence, governments need to
provide a guarantee against
foreign exchange risks.
Financing

7. 7
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Jannat Salimova - Tekay
Senior Manager, Transaction
Advisory Services
Project and Infrastructure Finance
Advisory
Email: jannat.salimova-tekay@kz.ey.com
Tel.: +77272585960
Ernst & Young Advisory LLP
Transaction Advisory Services
Al-Farabi av., 77/7
050060 Almaty
Republic of Kazakhstan
Contact information