ppp department within the ministry of economy and transport government decree in may 2003 to set up...

PPP Department within the Ministry of Economy and Transport

Government Decree in May 2003 to set up an Interdepartmental Committee

– Ministry of Economy and Transport

– Ministry of Finance

– Ministry of Justice

– Prime Minister’s Office

– Central Statistical Office

Public Private Partnership

Government actions to promote PPP

www.gkm.hu www.itd.hu

Long-term goal: 2500 km length of expressway network by 2015

Act CXXVIII on the development of the Hungarian expressway

network (accepted by the Parliament in December 2003)

Deficit constraints => need for alternative ways of financing− PPP projects− EU funds

Road infrastructure development program



Approximately 170 km section between Budapest and the Hungarian - Serbian

border

Original concession agreement signed in 1994 with French consortium AKA

First phase (110 km) handed over in 1999

New agreement reached in March 2004

Further 60 km section is expected to be built

PPP motorways: M5



Second phase to be built by AKA (estimated cost: EUR 836 million at December

2004 value)

The motorway became part of the national vignette system

DBFO (design-build-finance-operate) structure with risk sharing - construction

and availability risks borne by AKA

Availability payment mechanism

Deductions in payments in case of poor performance and safety indices

Amended structure of the M5



Part of the V/c Helsinki corridor

Approx. 252 km section between Budapest and the Hungarian - Croatian border to be built in 2 phases:

– first phase between Budapest and Dunaújváros (54 km) by 2006– second phase between Dunaújváros and the Croatian border (198 km) by

2007

PPP motorways: M6



Concession tender won by Bilfinger Berger BOT GmbH, Porr Infrastruktur

GmbH, Swietelsky International Baugesellschaft mbH

Concession period: 22 years

Timing:

− Concession Agreement signed on 2 October 2004

− Target interim completion date: March 2006

DBFO structure

EIB and EBRD considers providing financing to the concessionaire

PPP motorways: first phase of the M6



Payment mechanism:

− national vignette system

− availability payment to the concessionaire

Risk sharing:

– International practice

– State: discriminatory change in law, delivery of the Site, dangerous

materials, etc.;

– Concessionaire: design, construction, financing, availability, except relief

events;

– Shared (vis major)

PPP motorways: financial structure of the M6



Projects of the Ministry of Education

Goal: development of university infrastructure

– Government decision on creating 10 000 accommodations in student

hostels in the framework of PPP

The pilot project of the University of Debrecen

− Classical DBFO structure

− Decision of PPP Committee on supporting the project on 30th September

2003

− Approval of the Economic Cabinet and the Government

− Public procurement procedure completed, construction is under way

11 further similar PPP schemes for other universities

PPP student hostels



Goal: the development of prison service infrastructure - two new PPP prisons

DBFO construction– During a period of 15-20 years, 700 prisoner places / prison– „Operate” element: only those tasks are performed by the state which can

not be carried out by the private sector (custodial services, on site medical facilities and registering of prisoners)

– Positive decision of the PPP Committee: 10th October 2003

Tender announcement is expected at the beginning of 2005

Prison project of the Ministry of Justice



ppp department within the ministry of economy and transport government decree in may 2003 to set up...

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