Hello everyone.
Today we will continue with the previous topic
Earlier we talked about the current situation and reasons for the abolition of the PPP, and today we will talk about the emergence of a new model.
You should be familiar with PPP;
It is a public-private partnership, the Z government builds a platform, and social capital sings;
Everyone cooperates and earns money together.
PPP has different modes;
For example, the French franchise model:
That is, users pay as much as they use.
The Private Financing Scheme Model in the UK:
It's that the Z government pays someone to do it.
We are also trying to use PPP to introduce social capital in the field of infrastructure and public services.
This is because this will not only improve the level of construction and management, but also reduce the burden of local debt.
Since 1984, there has been a PPP project in China;
At that time, Shenzhen Shajiao B Power Plant Project was the first BOT project in China
However, it was foreign investment at that time.
In the 90s, the state began to try to use PPP as a pilot.
Later, in 2003, the number of PPP projects began to increase;
It is mainly sewage treatment projects, as well as tap water, subway, gas and other projects.
But after the 2008 stimulus package was introduced, there were fewer PPP programs.
Because the policy and legal environment at that time were not very supportive of PPP development.
It wasn't until 2014 that the situation began to change.
A series of documents have been issued at the top level to support the PPP project;
Special centers have also been set up in various localities to promote it.
Since then, PPP projects have increased and the demand has increased.
But in 2017, PPP projects began to decline for various reasons.
Until 2023, the PPP entered a period of total shutdown.
Because when the audit inspected the PPP project, it was found that various problems such as lax audit in the warehousing link, incomplete integrity in the performance link, improper construction and operation links, and blame shifting responsibilities were prominent......
Submitted to ** at the beginning of the year;
Then in February this year, the PPP entered a state of complete shutdown;
c. The project library of the PPP Center of the Ministry of Administration is suspended from the storage of new projects
At present, they are still under "system maintenance".
Projects such as new projects and projects that are ready to start construction are basically stalled;
Some localities are rectifying the PPP projects that have been implemented in the past.
In the first half of 2023, not only will there be no new PPP projects, but old projects will also be basically suspended
The suspension and rectification of the current round of PPP projects is also known as "shock**".
However, recently, the first level has launched a blockbuster document to regulate the development of PPP;
Let the market see that the PPP, which has been silent for 9 months, has reappeared.
On November 8, the state issued the Notice on Guiding Opinions on Standardizing the Implementation of the New Mechanism for Public-Private Partnership (Guo Ban Han 2023 No. 115);
According to this latest document, it is clear that China's follow-up PPP projects will all be implemented in a franchise model.
In the context of the PPP model with many problems and stagnation;
This document is also widely regarded as a signal for the country to restart the PPP.
So what are the key points under the new PPP mechanism, I have also sorted it out for you:
First of all, the National Development and Reform and C Politics have issued guiding opinions;
It clarifies the return mechanism, implementation method, participating entities, management institutions and other issues of the PPP project
Guidance was provided for new PPP projects.
This was followed by a series of important changes to the new PPP program:
Clause. 1. Focus on user payment items, and clarify the provisions on charging channels and methods
And all adopt the franchise model;
The regulations apply to infrastructure and utility projects.
This ensures that the project is carried out in an orderly manner and is only applicable to projects that have operating income and are paid for by the user.
Secondly, the projects of the government and the private partnership were classified
The stock projects that have signed the agreement shall be implemented in accordance with the special documents under the new mechanism.
Projects that have not signed an agreement will be implemented directly according to the new document.
This ensures that the project can move forward in an orderly manner.
In addition, the new PPP mechanism will give priority to supporting private enterprises to participate in franchise projects
In the future, private enterprises will be especially encouraged to play a role in projects with a high degree of marketization and weak public attributes.
The franchise plan should be strictly reviewed to ensure the feasibility and professionalism of the project;
Moreover, the selection of franchisees is required to be carried out through open competition.
This ensures the quality and professionalism of the project and avoids unreasonable competition.
Finally, the new PPP mechanism requires the implementation of investment management procedures;
Ensure that both the government and the private party perform the approval, approval or filing procedures in accordance with relevant laws and regulations.
This ensures the legal compliance of the project;
At the same time, it also protects the rights and interests of all parties ......
Through the above changes and requirements, the new PPP mechanism is intended to return the PPP project to its original intention
Realize sunshine operation and standardized operation.
The new mechanism stipulates that the franchise project needs to formulate a plan according to the actual situation;
However, commercial, industrial and non-profitable public welfare projects cannot be packaged into franchise projects.
Moreover, the new mechanism encourages private capital to participate in PPP projects, and clarifies the shareholding ratio requirements
At the same time, the recognition of foreign-invested enterprises is also relatively relaxed.
There should be fewer and fewer old PPP projects in the future;
Because of the high pressure of local government and the difficulty of private enterprises to participate.
Existing projects will also be implemented under the new mechanism;
The corresponding new model franchise project will receive more support;
This should also be a new idea for the issuance of REITs for cultural and tourism infrastructure.
But how exactly it will be carried out needs to be watched ......
If there is any latest news, I will share it with you in a timely manner in a follow-up article.
It is hoped that from the interpretation of the new Z policy, it will bring a change of thinking and new opportunities to the partners of the construction industry.