Marketing the PPP is an essential component of PPP design and tender activities that is too often given short shrift. The ways in which government should interact with investors change in approach and objective along the PPP transaction timeline.
Very early interaction with possible investors (even prior to launching the PPP project) assures the government that there will be enough interest in the project to generate competition (and go a long way to assuring value for money).
This early interaction should be followed by a Request for Expressions of Interest accompanied by the publication of a project teaser, sent directly to known interested parties and advertised more broadly through appropriate channels. This allows the government to build its target list of investors and continue with more intensive communication with this group of companies. This could include conducting investor conferences, meetings, or road shows to present the project. The scale and location of meetings can be tailored depending on the profile of the investors.
Continued close communication with the investors who expressed interest, up until the formal launch of the bidding process is very important, especially if there are external shocks (such as a downgrade of the country's credit rating, or an improvement in investment conditions in other regions that might draw investors away). This not only serves to maintain their comfort and interest, but allows the government to ensure the project is structured in a way that will appeal to investors.
In situations where the market is not well known or is particularly fluid, it is very useful to conduct a Request for Qualifications early on in project development. Where the market is well understood the REOI can be folded into the RFP as a first hurdle.
The next step may be to carry out a bidder pre-qualification process, to select the companies and consortia that will be invited to submit proposals. Not all countries select qualified bidders in advance, instead assessing qualifications as part of an open bidding process.
The pre-qualification process consists of preparing and issuing the Request for Qualifications (RFQ)—along with advertising the launch of the tender process, and evaluating the information received to select a group of qualified bidders.
For procurements that include a pre-qualification stage, the procurement process is officially launched when the RFQ is issued. The RFQ typically includes enough information on the project for potential bidders to decide whether they are interested, and information on how the project will be procured. It should also clearly set out the process and requirements for the qualification process.
Information on the project at this stage could include an overview of technical and service requirements, key commercial terms (although not typically a draft contract), and a list of the further information that will be made available at the procurement stage. Information on the qualification process typically includes the qualification criteria, the information required from firms and the format in which that information should be presented, and the timeline and process for evaluation.
Firm qualification criteria can be quantitative or qualitative. They typically involve considering the sponsoring firms’ financial robustness, previous experience with similar projects, and the experience of key members of the management team.