The main concept of the bill is that, in contrast to the traditional scheme, where companies are simply contracted by the State for the construction or development of public works, under the adoption of the PPP regime, the private sector would play a greater role in projects, funding the work and then receiving payment for the provision of services, on long-term contracts.
In this way, companies assume greater risks in projects developed under the PPP model, and the state doesnt have to assume the costs arising from financing these developments. Companies financing the works receive a multiyear contract to provide services and therefore, as well as assuming certain risks in the construction of the project, can also be responsible for operating the development or rendering the service.
Panamanian medical associations oppose the project, noting the end result will be the privatization of health services, because the bill includes "concessions for the construction of hospitals, roads, ports, sewage and drinking water management services."
More on this topic
June 2011
The government wants the private sector to be more involved in the development of infrastructure and services normally provided by the state.
The project to draft the law establishing a system of public-private partnership (PPP) is now being studied by the Panamanian National Assembly.
November 2011
President Martinelli has announced that bill no. 349, that would set up a framework for enabling public-private partnerships (PPPs), will be sent back for further discussion.
The announcement was viewed positively by hospital leaders who stopped work on 20 October in protest at the proposed law.
April 2011
The Ministry of Economy submitted to the Assembly a draft law creating a system of Public-Private Partnership (APP in Spanish).
The APP is an alternative to the execution of works or public services that have traditionally been carried out by the state.
The scheme works by making contracts between the public and private sector, in which the latter constructs, finances, operates and maintains infrastructure or provide services.
May 2011
The bill submitted by the Government proposes a term not exceeding 40 years, including extensions, for public-private contracts.
The government is seeking to encourage private participation in infrastructure with the new law on Public-Private Partnerships (PPP).
The proposal includes three types of contracts for the PPP:
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