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Hayek: Ministers block private sector participation
Civilians are seen trapped in their cars in a flooded tunnel on the Airport-Khalde highway, Wednesday, Dec. 4, 2013. (The Daily Star/Hasan Shaaban)
Civilians are seen trapped in their cars in a flooded tunnel on the Airport-Khalde highway, Wednesday, Dec. 4, 2013. (The Daily Star/Hasan Shaaban)
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BEIRUT: Some of the ministers refuse to involve the Higher Council for Privatization in certain vital projects in order not to undermine their authority and privileges, the secretary-general of the body said Wednesday.

“The reason we do not have public-private partnerships yet is because certain ministers consider legislation that involves all stakeholders in the decision-making as taking away their privileges,” Ziad Hayek told The Daily Star. “They want to appoint their own people and award contracts without returning to the Higher Council for Privatization. This is a pity.”

PPPs were mentioned several times in the policy statement of caretaker Prime Minister Najib Mikati’s Cabinet, but this concept, which was embraced by most political parties, never saw the light of day.

PPPs allow the private sector to contribute to certain big infrastructure projects, such as the construction of power plants, to reduce the financial burden on the government.

Among the prerogatives of the privatization council are overseeing and implementing privatization programs as well as negotiating with firms bidding on build-operate-transfer projects.

However, for the past six years, the council has been sidelined by successive governments and has not played any major role in key decision-making over infrastructure megaprojects.

Hayek said successive governments since 2008 had not furthered the council’s efforts to privatize the cellular networks nor implemented a single PPP:

“We and the head of the Telecoms Regulatory Authority at that time, Kamal Shehadeh, tried in vain to persuade the Cabinet to speed up the tender for the privatization of the telecom sector. But the Cabinet dropped this idea under the excuse that the president of the republic was not elected yet.”

Hayek said some of the ministers want to take full credit for any project without even consulting the privatization council or seeking its advice.

Citing some examples, Hayek said that in May 2008 the council completed the tender document for the PPP power plant in Beddawi but former Energy and Water Minister Alain Tabourian refused to open the bids because he was against the involvement of the private sector.

“Some of the ministers think they know what needs to be known; therefore they don’t want to involve other people,” he said. “Every minister wants to succeed, and every minister is trying to do the right thing. These ministers sometimes refuse to continue the work of their predecessors, which ultimately delays the implementation of the project.”

Hayek was one of the officials who voiced strong objection to the contract awarded to a Turkish company to lease two electricity barges to Lebanon.

“The tender to award the contract to the Turkish company was a disaster since it failed to meet the basic conditions,” Hayek said, adding the company not only charged more than competitors “but also failed to supply electricity on time and according to the contracts it signed with the Energy Ministry.”

Hayek argued that the maximum duration of any Cabinet in Lebanon was two years, preventing any minister from carrying out a successful five-year plan.

“One way to guarantee the success of the project is to set up a regulatory authority, which will make sure that all the energy projects are fully executed.”

He insisted on depoliticizing vital projects to remove roadblocks from any political groups.

Hayek reminded critics of privatization and PPP of Law 462 from 2002 that calls for the creation of a regulatory body for electricity.

“No minister has implemented this law because it appears they don’t want to lose control. Egos are killing the country,” he added.

Hayek stressed that if the government awarded the construction and road-rehabilitation contracts based on PPP principles, Lebanon would not have experienced the flooding of highways two weeks ago:

“The companies that built or rehabilitated these roads would have been held accountable, and the government would be able to sue them for failing to meet the conditions of the contract.”

A version of this article appeared in the print edition of The Daily Star on December 12, 2013, on page 5.
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