Every time the government needs to show that is serious about its work, it boasts over the concessions and Public and Private Partnership. Every time the public needs to remember what corruption is able to do to this country, it also refers to concessions and PPPs. So far, we’re in an urban legend. Someone may justly accuse me of an excessive obsession to criticize everything good, every effort to introduce a new style of governing and a new form of engagement in the modernization of the country. But, as a journalist, I never change the main principle of my work. I am in search of the truth through the collection of facts in order to uphold issues of a public interest. In this analysis, I shall try and establish a link between the government’s obsession of PPP and public interest.
What is the public’s benefit in the process of the selection of concessions in public sectors?
Based on what costs, benefits and efficient services have the existing ones been given?
What was their quality?
What sort of sustainable financial benefits have they provided?
Who have been the beneficiaries?
In a televised interview that the Albanian PM gave a while ago, he was asked on these topics, but in the absence of arguments, he declared that concessions and the involvement of private capital in public investments are something that he is very proud of.
But the state doesn’t recognize pride as an instance. It recognizes laws, written rules and institutions. Back in February, I wrote an article on the 1 billion euro project. Since then, several things have happened. In healthcare, almost every service has been given in the form of concession. Meanwhile, the Prime Minister entered the elections without a clear economic program and continued to boast over the implementation of the 1 billion euro project.
The majority is always careful on reminding us that in the past 27 years, the country has been ruined and that the state will be built from scratch.
However romantic is the government’s attempt to launch a major state consolidation reform, the state is kept on its feet through its mechanisms, Constitution, laws.
This time, we refer to the High State Audit, the highest institution of financial and economic audit, which has a duty to inform the public and Parliament on the use of sources with efficiency and effectiveness by the central and local government. A while ago, this institution drafted a report following an audit carried out at the Concessions Management Agency (ATRAKO) to verify the lawfulness of concessionary deals and Public-Private Partnership. According to this report, so far, the Council of Ministers has not yet approved a strategic document of policies in order to determine the priority sectors for investments which will based on the cooperation between the public and private sector.
I would also like to refer to the World Bank. According to this institution, the main risks that countries involved in PPP projects are exposed to are: procurement expenses grow significantly and for this reason, the government must determine if the costs included in these investments are justified. The Bank points out that special institutions all over the world, in charge of the implementation of PPPs, have developed methods to analyze these costs? Is this being done here? No, we were just told that a strategy is lacking.
However, 1 billion euros will be invested in three years in infrastructural projects, the government says. Through public-private partnership, the government invites private agencies and different companies to offer capital and assets in order to realize infrastructural projects. So, private companies finance, build and operate elements of public services. They are paid back throughout the years through fees charged to users.
PPPs have seen successes and failures and by comparing them to the findings of the High State Audit, each of one is able to clearly understand where the government is taking us with this plan without a strategy.
A while ago, the Prime Minister announced that the plan for the construction of Arber Road is part of the 1 billion euro project. Even IMF was against the way this project would be funded. The government initially agreed with the Chinese company “China State Construction, the third largest company in the world, funded by the Chinese government. But the Chinese company withdrew because it didn’t agree with the conditions imposed by the Albanian government. Now, part of this new PPP relationship is an Albanian company. Its offer is more expensive than the offer made by the Chinese company, meanwhile the state is increasing its funds. Why? By declaring “we will start the construction of Arber Road in September in order to put an end once and for all to this story”, are we sure that we could obtain a higher quality of road and the best price possible, without burdening Albanian taxpayers? Who can say this? For the moment, the Prime Minister who does nothing else but boast.
Note: The views expressed in this article are the author's own and do not necessarily reflect Albanian Free Press’ editorial policy.
