AfricaGrowth Agenda

Public-Private Partnerships, if applied well, can help overcome inadequate infrastructure that constrains economic growth particularly in developing countries. Infrastructure investments are recognized to speed up much-needed growth in developing nations and reduce income disparities. PPPs can help overcome some of these challenges by way of mobilizing private sources, supporting the improvement of project selection, on-time, and on-budget implementation, and ensuring adequate maintenance. It is very important for public and private sector partners to completely understand different types of risks which are associated with Public-Private Partnership projects throughout the entire life cycle of the projects. Public and Private sectors should also be fully aware of the significance of these risk factors, how to manage and allocate them in a bid to ensure success and sustainability of partnerships. Appropriate risk assessment, management, and allocation between the public and private sectors are very important in enhancing Public- Private Partnership projects. Inappropriate risk allocation can ruin the value for money in Public-Private Partnership projects. This article gives insights on importance of effective and efficient risk allocation framework in PPPs.

An exploration of the use of project bonds as a complimentary financing instrument for infrastructure projects in South Africa is very much appropriate in light of the fact that there has yet to be a single project bond listed on the Johannesburg Stock Exchange ( JSE), and that the regulator is currently finalizing a structure for the listing of project bonds on the South African bourse. Specifically, the question worth probing is whether different classes of investors would be interested in participating in a project bond offering where the underlying is an infrastructure development in the South African space. Who are the key stakeholders that will be involved with a project bond in South Africa and what is their level of interest and willingness to invest in infrastructure projects through project bonds.

A long-standing issue in the microfinance literature is the trade-off between the seemingly dichotomous objectives of microfinance institutions (MFIs), namely financial sustainability and social outreach. In our research, we argue that MFIs which offer savings products may provide special insight into the trade-off. Specifically, we investigate whether micro-savings attenuate the trade-off between financial sustainability and the depth and breadth of outreach. We specify and estimate an econometric model using data from 1,233 MFIs in 79 countries for the period 2000-2012, with a group of MFIs which takes micro-saving deposits and a control group that does not. We measure micro-savings by using the number of net savers, total deposits and the number of deposit accounts per staff member. We uncover new results which suggest that MFIs which take micro-savings can achieve financial viability as well as social outreach, unlike their counterparts in the control group of MFIs where the trade-off persists. We thus conclude that micro-savings help to attenuate the trade-off between financial sustainability and social outreach.