Bubbles, Manias and Market Failures: the Unintended Consequences of Regulatory Responses

“I’m producing this much carbon now, but I’m betting that in 20 years, there’s going to be some technologies that takes that carbon out,” then how should we regulate those products, because that’s enticing to people. There’s a moral hazard there Continue reading Bubbles, Manias and Market Failures: the Unintended Consequences of Regulatory Responses

Seismic costs

Dawn | October 7, 2018 Imaduddin Ahmed WHEN considering investment in an infrastructure project, responsible investors or donors would ask: what is the need? What are the financial, social and environmental costs? What are the risks and the unknowns? Is the project likely to yield higher costs than benefits? Is the project the best option to address the need? Pakistan’s judiciary and government have called upon Pakistanis to invest in the Diamer-Basha and Mohmand Dam Fund, and yet they have insufficiently addressed these questions. The Supreme Court’s online app­eal is not accompanied by a feasibility study. From the outside looking … Continue reading Seismic costs

Acumen share pioneering investment philosophy with Bartlett PhD students

18 December 2017 | Bartlett News Bartlett School of Construction and Project Management PhD Candidate Imad Ahmed reports on a talk from Mr Farrukh Khan of Acumen. Following dinner in the Great Hall of Goodenough College, Acumen’s Chief Business Development Officer … Continue reading Acumen share pioneering investment philosophy with Bartlett PhD students

Leapfrogging into the light

Financial Times | 27 March, 2017 Solar systems help Rwanda government switch from provider to regulator of electricity by Imaduddin Ahmed Mobile phones were the “leapfrog” … Continue reading Leapfrogging into the light

PPP success in Rwanda shows potential for greater self-reliance

Financial Times Beyond BRICS | 2 April, 2015 New Times | 4 April, 2015 allAfrica | 4 April, 2015 World Bank EIN News Desk | 6 April, 2015 Twenty-one years after its genocide, Rwanda ranks 46th in the world for ease of doing business according to the World Bank, four spots below its former coloniser Belgium. This is flattering. The rush with which international lenders financed its energy utility’s first solar public private partnership (PPP) demonstrates that this ranking is not empty academic musing. Yet, in the same manner in which Rwandans drew on their own internal reserves of strength … Continue reading PPP success in Rwanda shows potential for greater self-reliance

African (frontier market) risks associated with PPP infrastructure

and how they can be mitigated. Compiled by a PPP transactions advisor to Rwanda (me). Barriers to private investment in African infrastructure: Country political risk –          Eg. medium or high likelihood of terrorist attacks, war, corruption, riots, strikes Risk of expropriation Payment risk Insolvency for state off-takers such as state utilities Inflation/currency depreciation Currency convertibility Risk mitigants and Rwanda’s experience: Country political risk – Solution: State to improve security internally by having a strong law enforcement agency and also by pursuing sustainable and fair domestic and foreign policy – Rwanda surveyed as the African country where citizens feel most safe according … Continue reading African (frontier market) risks associated with PPP infrastructure

Is your local public-private partnership going to be a happy one?

By Imaduddin Ahmed and Shilesh Muralidhara The East African | January 11, 2014 Partnerships can be wonderful. They can also be disastrous. So, too, is this the case with partnerships entered into by governments and businesses for the delivery of public goods, which can either lose countries millions of dollars per project or initiate virtuous economic growth cycles. Public-private partnerships (PPPs) are mechanisms in which governments transfer upfront costs and risks for infrastructure projects meeting public needs to private sector developers. Power plants, water treatment facilities, roads, stadia, airports, hospitals — all of these can be given birth under PPPs, … Continue reading Is your local public-private partnership going to be a happy one?

Stories private equity is looking for in Africa

Businesses: –    The business model is scalable –    There is a compelling case that there is large latent/unmet demand for the product/service –    Competition is underperforming/non-existing and barriers to entry are high –    Competition for financing a given firm is low (don’t want to enter a bidding war) –    Strong personal relationships with management –    Strong balance sheets for financial institutions (diligence their Accounts Receivable and recovery rates) –    Strong Debt Service Coverage Ratios for mature businesses Economies: –    Rapid growth in the urban middle class – rapid demand growth from the latent baseline –    Large domestic market –    Rule … Continue reading Stories private equity is looking for in Africa

Allocating & valuing risk in public-private infrastructure projects

Notes from Timothy Irwin’s  Government Guarantees – Allocating and Valuing Risk in Privately Financed Infrastructure Projects Bordeaux Bridge – early template of public-private partnership – Govt built bridge – Firm maintained and operated it and contributed capital for construction – Firm would get the toll for 99 years. If annual revenue < min., govt would pay the min. If >an amount, govt share half surplus On guaranteeing returns If firms aren’t convinced by the commercial viability of a project and require guaranteed returns, it’s probably not worth doing! On exchange rate risk For free floating currencies – If a govt … Continue reading Allocating & valuing risk in public-private infrastructure projects