Fiscal Sustainability, Not Demand Risk, New Test for Africa’s Social Sector PPPs – ECA

Africa’s Public-Private Partnership (PPP) units said fiscal sustainability, rather than demand risk, is emerging as the key test for social sector PPPs in Africa.
This was contained in a statement released by the Economic Commission for Africa (ECA) on Wednesday in Abuja.
It said the Second Forum for Public-Private Partnership (PPP) Units in Africa opened on Sept. 29, with a focus on making social sector partnerships deliver.
The two-day hybrid forum is themed “Making Social Sector PPPs Work: From Policy Ambition to Effective Service Delivery.”
The event is co-organised by the UN Economic Commission for Africa (ECA), the African Development Bank (AfDB) and the African Legal Support Facility (ALSF).
The organisers said the forum responded to a persistent implementation gap, as infrastructure PPPs remains central to Africa’s development agenda, but progress had lagged behind policy ambition.
They cited limited project preparation capacity, affordability pressures and institutional and technical gaps as the main constraints.
“Social sector PPPs in housing, healthcare, education, sanitation and energy pose a distinct challenge because they rarely generate enough user-fee revenue to stand alone.
“They rely instead on availability payments, public subsidies, viability gap funding or blended finance.
“This shifts the core structuring question from demand risk to fiscal sustainability, affordability and performance accountability,” the statement said.
Ms Hanan Morsy, ECA’s Deputy Executive Secretary for Programme, said social sector PPPs must be judged by more than the capital they mobilised.
She said success meant services that were accessible, affordable and sustainable, and that genuinely improved people’s lives.
“Turning that ambition into results, however, depends on strong project preparation and strong partnerships,” she said.
The organisers set five objectives, including building high-level dialogue among finance and sector ministries and exchanging practical lessons and case studies across sectors.
The others are strengthening upstream project preparation and bankability, building capacity for localised, performance-based PPP models, and establishing a lasting community of practice.
The statement said the forum opened with a Leaders’ Dialogue among ministers and senior officials.
“Breakout sessions will cover risk allocation, financing mechanisms, subnational and community-level PPP models and contract management and monitoring.
“Case-based project clinics will let practitioners work through real transactions.
“The forum builds on the 2024 inaugural edition, which convened over 30 PPP units around climate-resilient infrastructure.
“Outcomes will feed into an action-oriented follow-up framework, with participating countries naming focal points to track progress,” it said.
Mr Olivier Pognon, Director of ALSF and Ms Josephine Ngure, AfDB Country Manager, spoke at the opening session.
Ms Semereta Sewasew, Ethiopia’s State Minister of Finance for Economic Cooperation, welcomed delegates on behalf of the host government.