Trains, drains and automobiles, the new PPP thinking of Dubai

Got a revenue-generating plan that also provides a much-needed public service? Who are you going to call? The new Investment Office at Dubai Municipality, that’s who. Sean Cronin reports on moves by the local authority to establish innovative new partnerships with the public sector.

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By  Sean Cronin Published  January 28, 2006

From robotic car parks to tyre-powered cement factories, the fledgling Dubai Municipality (DM) Investment Office is prepared to consider all sorts of novel projects. Most contractors know DM as the main public sector client in the emirate, responsible for procuring new roads, bridges and other public infrastructure. But the organisation is increasingly moving towards outsourcing non-essential services to the private sector. And the move is already yielding some unusual project proposals. It plans to provide an increasing number of public projects and services through outsourcing and public private partnerships — and the private sector is already coming up with some weird and wonderful proposals. “We have an evaluation committee that studies proposals and we make a decision based on that,” says Ibrahim Yaqob Ali, director of the contracts and purchasing department at DM. Among the projects to be introduced is a ten-year plan to build hundreds of bus stops throughout Dubai, worth an estimated US $46 million (AED170 million). One of the largest partnerships to have been given the go-ahead is the $32.6 million Stargate project — a family entertainment centre that will form part of the recently-opened Zabeel Park in Dubai. The project is being undertaken by Dubai-based real estate developers, Osus, and it will be operational by March 2007. Another plan could see at least 500 automatic toilets installed around the emirate, under a BOT deal where the Municipality will provide the land to the operator, which will in turn derive revenue from customers who are caught short. The committee has also approved a plan to recycle cooking oil, while it is also in talks with private sector car park operators interested in developing car parks throughout Dubai. The DM has already out-sourced several services which were formerly handled in-house — such as photo-copying, where a third party provider charges the organisation for every photocopy made. Security services have also been outsourced, as have the operation of DM-run abattoirs. Yaqob Ali believes that more and more services will be outsourced as more private sector companies become big enough to handle them. “Some services that the government provides cannot yet be privatised because companies do not yet have the capability,” he says. This week the DM formally launched a new office, which will spearhead its drive into outsourced projects, marking a new phase in its development. Last year the Muncipality handled 27 investment contracts involving partnerships with the private sector — and that is set to increase substantially this year, according to Yaqob Ali. “We have already launched 27 investment contracts with the private sector, including public private partnerships and BOT (Build-Operate-Transfer) schemes,” he says. The new office will come under the control of the Investment Unit in the Contracts and Purchasing Department of DM. The overall aim is to attract innovative investment ideas and simplify the processing of those proposals from the private sector. In a city that can claim to be home to some of the most outlandish and ambitious projects in the world, expect to see some interesting proposals emerge in the coming year.

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