ada - business partnerships in adc, slovakaid 29 9 09

8/8/2019 ADA - Business Partnerships in ADC, SlovakAid 29 9 09

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Public Private Cooperation in Austria

Workshop: Public-Private Partnership in ODA

SlovakAid, September 29th, 2009

Hans-Jrg Hummer, ADA, Head of Business Partnership Office


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Public Private Cooperation WorkingDefinition

Development Agency teams up with private businesses tojointly conceive, finance and implement projects with

developmental relevance.


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Early

Efforts: Private

Economic Partnerships

1999 to 2004 Austrian Development Cooperation (ADC), still within the

Austrian Federal Ministry for Foreign Affairs, ran program called Private

Economic Partnerships:

Ministry together with private agencies tried to broker and co-financeprojects of companies investing in developing countries

Additional funding by EC through ProInvest Program

No real priority, moderate success, as only handful of projects

implemented


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Institutional Reform and New Agenda

Establishment of ADA in order to consolidate scattered structure

of ADC and prepare for new challenges and trends

New political agenda to stress economic development and

increase participation of private sector

Revised goal: Reduction of poverty by promoting economic

and social development, aiming at a process of a sustainable

way of doing business and at economic growth

New approach: Activities to foster private sector cooperation

New partners: Private companies explicitly stated

Partnerships with private sector have sound legal basis

In 2004, a new institutional structure was created and new notions

were introduced by the Development Cooperation Act 2002/03


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NewImpetus and Set-Up

In 2004/2005 ADA made new efforts to step up public privatecooperation

Decision to make development partnerships with the private sector anew priority field of action

Acknowledged need to have recourse to external know-how fordevising and setting up a major program:

Consortium led by GTZ wins tenders and opens BusinessPartnership Office (BPO) in Vienna on behalf of ADA, detaching threefull-time expert staff (2006)

BPO and ADA jointly conceived new program, which BPOautonomously managed under supervision of ADA


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Business & Development Partnerships

In 2006, ADA and the Business Partnership Office launched two distinct

programs aiming at mobilizing private sector for conceiving, financing and

implementing projects in developing countries

Business Partnerships: Austrian/European businesses mainly cooperate with

companies in developing countries (B2B) to increase the competitiveness ofall involved and/or strengthen local SME

Development Partnerships: Austrian/European businesses mainly engage

with local public institutions to improve framework for business operations

Instruments: Both programs included support of up to 50% of costs to

Fact Finding Missions (up to 1,700) Feasibility Studies (up to 20,000)

(fully fledged) Partnership Projects (up to 200,000)


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Criteria and FiguresCore Criteria

Long-term commitment of Austrian/European business partner

Additional benefit for partner country beyond the companys core

business and project duration

Substantial co-funding by private partner (at least 50%)

Compliance with local laws and international conventions No distortion of competition

Focus on ADC priority regions

Key Figures

550 requests for information of mainly Austrian companies

42 projects or 9m worth of grants approved, about 15m worth of

private and 9m of third party contributions triggered About 40% of projects in SEE, 40% in Africa

Broad range of topics: energy, vocational qualification, (organic) farming,

textile, IT, building of local company clusters, health etc.


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Making it Work: Factors of Success

Conception Dialogue: Each project preceded by intensive

dialogue with private sector partners and substantial assistance

with writing proposal

One Stop Shop: Quick response capacity

Active pipeline building: BPO intensively seeks and maintains

contact with businesses and business organizations

Target group: Partners are usually small to medium sizedcompanies, highly innovative in terms of sourcing and/or

marketing

Qualitative characteristics of Austrian Public Private Cooperation


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Review: Program-E

valuationEvaluation by GPPI in 2008 considered program an overall success

and recommended its continuation, though with alterations:

Abolish distinction between Development- and Business

Partnerships, as it is not convincing and understandable

Emphasize project types building and strengthening of supplychains and investment based development activities which

prove rather sustainable, but mind type-related risks

Discontinue type consulting, as weak impact and sustainability

Emphasize economic feasibility of projects in selection phase by

means of external assessment

Keep bureaucracy minimal to respond to business needs To increase effectiveness, elaborate for each project-type an

impact-logic with type-specific indicators


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Redesign:B

usiness Partnership ProgramIn response to the evaluation, in 2009 the program was carefully

modified but not substantially changed:

Consolidation of program by shaping unified Business

Partnership Program

Strengthening of instrument Feasibility Study by explicitly

including possibility to develop and test the business case

Abolition of instrument Fact Finding Mission

Exclusion of projects based on one time provision of services

Redefined geographic outreach to all DAC-countries with

emphasis on ADC-priority countries

Simplification of guidelines, application forms, budgeting and

financial reporting

Explicit application ofde minimis rule for small subsidies


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Reorganisation:Integration of

BPO

From the beginning of the cooperation with GTZ/Planconsult it was

foreseen that ADA would by degrees absorb the relevant know-how

and fully integrate the program into its structures and procedures

February 2008: BPO physically integrated into ADA

Throughout 2008: ADA staff gradually taking over know-how

and responsibility

April 2009: ADA has taken over full responsibility for the

program

June 2009: End of phasing out of technical assistance


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Remaining ChallengesHaving successfully started up a Public Private Cooperation Program,

ADC still faces challenges:

Additionally strengthen monitoring and impact measurement

Devise new mechanisms for generating new projects especially in

sub-Saharan Africa, e.g. by enhancing match-making efforts

Devise and implement strategy for adapting the methodology of

Public Private Cooperation to local context by integrating Business

Partnerships with local companies into country strategies and

budgets


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Thank You for Your Attention!

Austrian Development Agency

Business Partnership Office

Zelinkagasse 2, 1010 Vienna+43 1 90399 2577

[email protected]

ada - business partnerships in adc, slovakaid 29 9 09

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