african development-bank-ppp-model-djibouti-and-itzi doraleh terminal container
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1
Models of PPP Project Finance
Case Study
Presentation for Canadian
Council on Africa Montreal, March,19-20
African Development Bank Private Sector Operations
1. An Overview of PPP
2. Motivation for PPP
3. Doraleh project Case Study
- Project description
- Project shareholder structure
- Contract structure
The Canadian Council for Public-Private Partnerships defines PPP as “A cooperation venture between the public and private sector, built on the expertise of each partner, that best meets clearly defined public needs through the appropriate allocation of resources, risks, and rewards.
3
1. 1. To attract private capital investment (often to either supplement public resources or release them for other public needs);
2. 2. To increase efficiency and use available resources more effectively;
3. 3. To reform sectors through a reallocation of roles, incentives, and accountability; and,
4. 4. The allocation of risks between partners who are better able to manage risk.
Development, construction and operations of Container terminal in Republic of Djibouti in a 30 year concession under build-operate- transfer PPP arrangement
Total project USD 396 million with debt to equity funding of 70% 30%- first PPP financing in Djibouti
Joint venture between the Djibouti government and Dubai Port World
Djibouti port has a monopoly position for Ethiopian imports and exports
The new terminal has an annual capacity of 1.9 million TEU (twenty foot equivalent container units)
Bank provided USD 100 million, 10 year senior loan.
No loan to government;
Borrower is a single purpose business;
Separate legal and financial entity with ring-fenced cash
flows;
Sponsor guarantees don’t cover all the risks;
High leverage and long repayment terms ;
Contracts with major project parties are a key credit
support mechanism ; and,
Security rarely covers the nominal value of the loan.
100%
DP World Government
of Djibouti
DP World
Djibouti
Port Autonome
International de
Djibouti (PAID)
Doraleh
Container
Terminal
100%
33.3% 66.7% Concession
Agreement
Management
Agreement
JV
Agreement
Direct
Agreement
Direct
Agreement
Procurement
Agreement
Management
Contract Port Services
Agreement
Dredging
Contract Equipment
Contract
Fixed Price
Construction Contract
Direct
Agreement
Finance
Agreement
Doraleh Container
Terminal
PAID DP World
Djibouti FZCO
Government
of Djibouti
Financiers
Civils Crane
Supplier Dredging
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