In countries with relatively new PPP programs, project selection often means sifting through the various project concepts already generated by sector agencies, and screening these projects for PPP potential using the approach described in Section 3.1.2: Screening for PPP Potential. In this context, Governments may also take into consideration additional criteria in deciding which potential PPP projects to develop first. Often at this stage the priority is to build experience and momentum in the PPP program by achieving project successes in a relatively short timeframe.
Several factors may feed into this process. For example, the Philippines PPP Center notes that projects in its PPP program pipeline (on its 'PPP List') were selected based on the following criteria:
• Project readiness and stage of preparation-some projects have been further developed than others before being proposed as PPPs, reducing the remaining project development cost
• Responsiveness to the sector's needs-the order of implementation of PPP projects needs to be aligned with overall sector priorities within the strategic plan-in other words, PPPs should be central to the development of the sector, not peripheral projects whose benefits may turn out to be marginal, or which may distract from strategic priorities
• High 'implementability'-prioritizing PPP projects with a high likelihood of success, that are considered most likely to attract private sector interest, and for which there is a precedent in the local or regional market.
In an interview with the Reason Foundation, the Director of the Puerto Rico PPP Authority also describes how the Authority initially prioritized PPP projects that were most ready to go to market, as well as ensuring that these corresponded with overall policy priorities (such as brownfield school PPPs).
| Key References: Identifying Candidate Projects | |
| Reference | Description |
| India, Ministry of Finance (2011) PPP Toolkit for Improving PPP Decision-Making Processes, New Delhi | Module 2: Work through the PPP process, Phase 1: Identification provides extensive guidance on identifying PPP projects |
| Colombia, Ministerio de Hacienda y Crédito Público (2010) Manual de Procesos y Procedimientos para la ejecución de Asociación Público Asociaciones Público-Privadas, Bogotá | The Process and Procedures Manual for PPP Projects describes (on pages 34-38) the information that an implementing agency must include in its initial report to the PPP Unit requesting that a project be implemented as a PPP |
| South Africa, National Treasury (2004) Public Private Partnership Manual Module 4: PPP Feasibility Study, Johannesburg | Module 4: PPP Feasibility Study describes "needs analysis" and "options analysis" as the first two stages of carrying out a feasibility study to "decide whether conventional public procurement of a PPP is the best choice for the proposed project" |
| India, Ministry of Finance (2008) Scheme and Guidelines for India Infrastructure Project Development Fund, New Delhi | Describes the rationale for establishing the IIPDF, to overcome barriers to PPP project identification, and the structure and operational arrangements for the fund. |
| Perú, Ministerio de Economía y Finanzas, Pautas para la Identificación, formulación y evaluación social de proyectos de inversión pública, a nivel de perfil, Lima | Module 2: Identification within the Guidelines for the Identification, Formulation, and Social Evaluation of Public Investment Projects sets out the "gap analysis" approach to identifying investment needs and projects. |
| Asian Development Bank (2008) Public-Private Partnership (PPP) Handbook, Manila, Philippines | Chapter 3: Structuring a PPP: Sector Diagnostic and Sector Road Map sets out how identifying possible PPPs can be part of an overall strategic review of a sector |
| Colombia, Ministerio de Hacienda y Crédito Público (2010) Análisis de Elegibilidad para la Preselección de Proyectos de APP, Bogotá | The Eligibility Analysis for Pre-selection of PPP Projects defines the PPP eligibility index, describes the general eligibility criteria, and presents 23 questions that must be answered by the implementing agency in order to assess the eligibility of the project to be implemented as a PPP |
| Hong Kong Efficiency Unit (2008) An Introductory Guide to Public Private Partnerships (2nd ed.), Hong Kong, China | The first section of Chapter 4 "making the business case" sets out the criteria that a project should meet to have a "prima facie" case for being implemented as a PPP |
| Farquharson, Torres de Mästle, and Yescombe, with Encinas (2011) How to Engage with the Private Sector in Public-Private Partnerships in Emerging Markets, World Bank/PPIAF | The section on developing a PPP "Investment Framework" on pages 21-23 describes the importance of building a PPP project pipeline, together with clear public sector investment plans |