(MENAFN– Gulf Conferences)
Credits: Alicia Buller at Partnerships Bulletin
The Gulf region is looking to expand its educational offerings through Public-Private Partnerships (PPPs) as part of its broader economic diversification plans. While PPP models have traditionally been used for essential services and utilities, governments are now increasingly utilizing them for social services like schools, hospitals, and clinics. Countries including the UAE, Saudi Arabia, Kuwait, Oman, Jordan, and Morocco have ambitious plans for major school projects funded by PPPs. As the Gulf Cooperation Council (GCC) nations aim to transition towards more sustainable economies beyond hydrocarbons, developing social infrastructure and increasing education capacity emerge as crucial economic imperatives.
Dominic Holt, a partner at PwC Middle East, emphasizes that quality education is a well-known catalyst for future economic growth. He adds that the development of social infrastructure, augmented private sector involvement, and attracting foreign investment are central to the economic visions of the Gulf.
According to Nicholas Kramer, a partner at Norton Rose Fulbright based in Dubai, PPPs are gaining prominence in the Gulf to support the growth and diversification of the education sector. While the Gulf’s primary focus has been on infrastructure projects, there is a notable and growing pipeline of PPPs in education. These encompass the establishment of new educational facilities, upgrading existing ones, and outsourcing management services.
Kramer further explains that the Gulf seeks to integrate PPPs into its education sector to draw on private expertise, spur innovation, drive economic growth, while also reducing financial burdens on governments and sharing risks with private entities.
In a significant development for the UAE, Abu Dhabi introduced the Zayed City Schools (ZCS) project in 2022, marking the country’s inaugural education PPP initiative. This project, overseen by Besix and Plenary, encompasses a 20-year agreement for the operation and maintenance of three campuses, accommodating a total of 5,360 students. Nicolaas De Koning, head of bids and assets at Besix Middle East, suggests that the ZCS project could signal the start of a wave of similar projects in the region.
Meanwhile, Saudi Arabia is progressing with the construction of 60 schools through PPPs in Mecca and Jeddah, with plans for additional training schools and boarding school bundles. Oman’s Ministry of Finance recently accepted tenders for its inaugural PPP in the education sector, a substantial undertaking that garnered a strong response from the private sector. This initiative involves the design, construction, financing, and maintenance of 42 schools across the Sultanate.
With robust political support and a commitment from governments to pursue the PPP route for social infrastructure development, the Gulf region is attracting significant international interest. In the education sector, the Gulf can leverage its experience from a relatively long history of school projects, particularly in Europe. Holt suggests that global lessons learned from international education projects can be applied from the outset in the GCC markets.
Unlike some other sectors, such as transport or healthcare, school design and delivery are generally similar worldwide, allowing for swift and effective implementation of experience in the Middle East. Holt emphasizes that establishing a dedicated project pipeline will be pivotal to the success of the Gulf’s education-focused PPP initiative. This will enable foreign investors and providers to plan necessary investments, form partnerships, and allow authorities to benefit from economies of scale while maintaining healthy competition.
Ultimately, sponsoring authorities must ensure that proposed programs align with their long-term education strategies, with careful consideration of required services and specifications prior to market entry to facilitate efficient procurement. With numerous projects poised to commence and growing recognition from governments of the need for such investments due to expanding populations, attracting a diverse range of international investors will be essential to ensure bidders are not simply cherry-picking the most lucrative opportunities. Fostering strong competition should be a primary focus.