June 27, 2017

Jamaica Explores Public Private Partnerships

Posted on June 27, 2017March 6, 2020 by Staff Writer

Jamaica, like many countries, has a problem when it comes to housing for healthcare workers and other critical emergency personnel. The problem is that these careers generally offer a reasonable salary, but remains difficult to attract workers to regions that are very expensive, or very poor. And because of the front-line nature of emergency preparedness, there is a need for healthcare workers in every town, neighborhood and rural community.

The United States was ranked 16^th when it comes to the infrastructure competitiveness.

Even Jamaica is also having issues with affordable housing for healthcare workers. Dr. Christopher Tufton, the Health Minister of Jamaica, is now studying a public-private partnership proposal. This will therefore involve establishing accommodations for health workers. It will be beneficial not just for health care providers but also for the community.

Understanding Public-Private Partnerships Better

A public-private partnership, PPP, is a long-term contract between a private corporation and a governmental body. The PPP will supply public benefits, such as a service or an asset; in this case, housing for a particular group of employees.

Dr. Tufton explained during a tour at the Princess Margaret Hospital in Morant Bay, that the PPP needs an investor who will inject funds to build housing facilities.

“We would secure private participation in the financing and building of the accommodations,” he said. “[With] a long-term financing arrangement that would see the lease payments by the tenants occupying the facility”.

Dr. Cecil Batchelor, a Senior Medical Officer at Princess Margaret Hospital, is therefore concerned about the high turnover rate of hospital staff. He attributes this to the lack of housing or decent lodging.

Jamaica turns to PPP as a solution to provide healthcare workers accommodations.

Public-private partnerships may be the best solution on the table and create a win-win for the hospital, employees, and community. It is the hope that PPP can bring these to the table:

Better infrastructure solutions
Faster project completions
Greater Return-on-investment
Full appraisal of risks early on.
The project execution and operational risk is transferred.
PPP can include early completion bonuses.
Government funds will be re-directed to other important socio-economic areas.
The greater efficiency of PPP reduces the budget deficit.
High-quality standards
PPP allows lower taxes.

Additionally, the Princess Margaret Hospital, which sits on 26-acres of land, is an ideal location that could benefit from the PPP arrangement.

Countries that Practice Public- Private Partnership

Jamaica is not the only country that is seriously looking at PPP, there are other countries as well. The World Bank Group additionally mentions these are some of the public-private partnerships from different countries:

Ghana – PPP Advisory Unit
Nigeria – Foundation for PPP Association and the Infrastructure Concession Regulatory Commission
Uganda – PPP Unit (Ministry of Finance, Planning and Economic Development)
Kuwait – Partnerships Technical Bureau
Israel – PPP Unit at MF
Egypt – PPP Central Unit
Australia – Infrastructure Australia
China – Public-Private Partnerships Center
Hong Kong – Hong Kong Efficiency Unit
Indonesia – PPP Directorate of Bappenas and the Indonesia Infrastructure
Philippines – PPP Center
Belgium – Flemish PPP Knowledge Center
Croatia – Agency for Public-Private Partnership
Denmark – Danish Business Authority
Chile – Ministerio de Obras
Peru – ProInversion

So why is the United States of America lagging?

As one of the most powerful countries, it should therefore be a leader in PPPs. The spending of the United States on PPP infrastructure projects accounted for only nine percent of the global total. The reason somehow for this is the municipal bond market in the country.

The United States is number 16 when it comes to the infrastructure competitiveness. PPP units like the Federal Highway Administration, National Council of PPP, and Department of State; Global Partnership Initiative exist; but they are not enough for America to be hailed as a global leader in infrastructure.

Other Public-Private Partnership Plans for Jamaica

Aside from developing accommodations for health workers, Dr. Tufton also has other plans. He is going to study the need of the Princess Margaret Hospital for additional incubators. Dr. Tufton will also examine the reasons why the completion in the $143 million expansion of the Accident and Emergency Building of the hospital was delayed.

He expects that the construction of the new 220-bed facility on the grounds of Cornwall Regional Hospital which will be torn down before the end of the 2017 financial year.

Dr. Tufton also explained that this year, Mandeville Regional Hospital, Spanish Town Hospital, and St Ann’s Bay Hospital are just a few to be upgraded from being Type B to becoming Type A hospitals. Many of these projects may benefit from PPP.

Developing accommodations for health workers has become the way for PPP to enter Jamaica’s economy. Public-private partnerships undoubtedly have the capacity to build a cycle of mutual advantages for all the parties involved. With the introduction of PPP to Jamaica, it may be possible for the Caribbean island nation to emerge as a leader in the region.

P3 Can Solve U.S. Infrastructure Problems

Posted on June 27, 2017September 27, 2019 by Staff Writer

P3s are the hottest ticket there is when it comes to U.S. infrastructure funding. No other system offers the people of any country new and well-built infrastructure without those shiny new roads and bridges costing a dime. P3 is a great way to fund infrastructure that costs the public nothing and doesn’t create debt either. It’s clearly the answer to the United States infrastructure problems.

It seems like such a win-win situation, one wonders why the United States isn’t grabbing this lifeline with both hands. According to Bob Poole, the Founder of the Reason Foundation, a free market think tank, the United States is far behind the rest of the world in the use of P3 funding.

Poole notes that some of the challenges are structural. For instance, in the United States, funding for most infrastructure is through tax-free bonds, which makes it difficult for private companies to compete. In addition, the decentralized but layered structure of United States government, with federal, state, county, and municipal departments is a challenge when it comes to large scale infrastructure. The United States infrastructure problems could therefore be the best solution, if we really think about it.

Chile’s P3 Road System

As Poole suggests, private companies built and operate much of the highway system in Chile. Beginning in the early 1990s, the Chilean Government made plans for road infrastructure using the BOT model, an acronym for “build, operate, transfer.” Under this system, the private sector funds and builds the projects, and operates them as well, with revenue from tolls. There is also a government guarantee for 70% of investment in addition to maintenance and operating costs.

Chile delved into private road building as far back as 1935. There is an assumption that this long experience with privatization as a concept is the reason why Chileans have been so willing to adapt to the idea. The private roads enjoy widespread support and compliance by the majority of the population. As far back as a decade ago, Chile had already seen investment in their road system of over $5.3 billion.

Chile has four significant road projects that are critical to travel and mobility throughout the country. They are the North-South System which became open to public use in 2004. The owner is Autopista Central, S.A., and had major backing from ACS, Belfi, Skanska, and Brotec S: A. In this project the government invested $144.8 million, while private equity contributed $455.2 million.

What Else Chile has Been Doing

The Santiago East-West Highway System opened in 2005. The controlling body is Costanera Norte S.A., which comprises Autopista do Pacifico S.A, Autostrade Sud America S.R.I. The investment totaled $600 million, with $389.2 million contributed from private equity and $210.8 million from the government. The project opened to the public in 2005.

The Vespucio North-West System opened in 2006 and serves 1.5 million travelers. The concessionaire is Soc. Conces, Vespucio Norte Express S.A. The total investment was $350 million with $328.3 of that coming from private equity.

Vespucio South System opened the same year, serving citizens in the south of the Santiago metropolis. Soc. Conces. Autopistas Metropolitanas S.A., owns the project. It comprises the following investors; Itinere Chile S.A., Sacyr Chile S.A., Acciona Concesiones Chile S.A., Acciona S.A. The southern highway required a total capital investment of $650 million, of which $263.4 million was private and $386.6 million was public investment.

The entire system is undoubtedly very efficient and easy to run, using the Televia system for an electronic free-flow tele-toll. Users simply contract with one of the toll companies for automatic electronic payments. The Televia tags are free for users.

Australia P3 Roads and Privatized Airports

Australia has used P3 for numerous road projects, however, hey are one of the few countries in which most of their airports are privatized. And they began the process way back in 1988.

The first step was to create a corporation to manage the airports over the time it would take to go through the privatization process. The process took a number of years, but currently all of Australia’s major airports are under private lease agreement. Sydney was the last airport to go through the process, and was leased out in 2002.

Privatization allowed Australia’s airports to be upgraded and for services to be improved. At the same time they have proven to be good investments further adding to the strong Australian economy. Profit margins are up substantially since 2015, reflecting high and growing demand for airport services. All four major airports have seen year over year profit margins increase by 33.5% in Perth to 46.7% in Sydney. The Airports Branch of the Department of Infrastructure and Regional Development still regulate 21 of Australia’s airports. Can the same be done for the United States infrastructure problems?

United States Infrastructure Problems and Trump’s P3 Plan

P3 helped modernize this airport in Malaysia.

President Trump is a big fan of P3. He promised to build one-trillion dollars of U.S. infrastructure in his campaign. This will solve the United States infrastructure problems. Many wondered where he would get the money. It is going to come from private investors in P3 projects. With this funding system, private equity will be able to invest a mere $200 billion in order to secure financing for $1 trillion.

Many in the business community are waiting anxiously to learn which projects will be opened up to P3. At this point no one knows for sure. Busy airports in the Northeast, like New York’s La Guardia are regarded as plums ripe for the plucking and progress has been made with LGA and P3 partners. The airport does a huge volume of business and is, therefore, in dire need of upgrades and repairs.

Projects Underway We Should Know About

A $4 billion P3 project with LGP, a consortium of firms, including Vantage Airport Group,Meridiam, Skanska and Walsh Construction, HOK and Parsons Brinckerhoff was signed by Governor Cuomo on June 1, 2016 and is well underway. According to the New York State Press Release on Laguardia Airport Transformational Redevelopment, “The risk of cost overruns and schedule delays will be born solely by LGP under the design-build contract.” Earlier this year the FAA’s Airport Privatization Pilot Program approved the preliminary application of St. Louis Airport to also begin P3 improvements.

Other possible projects may be roads and rail lines in heavily congested areas. This is true for Los Angeles to San Francisco, or Dallas to Houston but with a financial discipline and justification. Any number of bridges and roads may be ideal for P3 resulting in a vastly improved infrastructure that could be efficient, well-built and properly maintained. These are just some of the United States infrastructure problems.

Some of the many countries that have used P3 to build infrastructure are Chile, Australia, Japan, Jamaica, and even Puerto Rico. It solved their need for infrastructure development without breaking the government purse.

It’s high time that the United States realize that government cannot and should not solve everything. If we want better infrastructure, we should therefore let the people who know how to do these large projects take the reins. P3 will give us infrastructure that is more efficient, higher quality, and better maintained. Also, it won’t cost the tax payer a dime. There is a solution to the United States infrastructure problems. The government should just push for it.

Suburban Poverty Crisis High and Still Rising?

Posted on June 27, 2017June 14, 2019 by Staff Writer

There are a lot of advantages of living in suburban areas, such as having more space to roam around, experiencing nature, and living in peace and quiet. People often opt to live in suburbs rather than in cities. They want to feel a strong sense of community, safety, and quiet. But lately, the attributes that made suburban living the preference for most upwardly mobile families have come under attack. The suburbs are deteriorating and the economic mobility that was part of their promise is visibly collapsing.

People used to leave the city because they were afraid. Now, if you throw car crash danger in, you’re really in more danger in the suburbs than the city.

Basic infrastructure, like suburban shopping malls are dying. Robert Florida, the Author of New Urban Crisis, said that “Today’s suburbs no longer look much like the lily-white places portrayed on sitcoms like Leave It to Beaver, The Donna Reed Show, or Father Knows Best.”

The New Urban Crisis talks about how the decisions of the creative class, who decided to move into and gentrify downtown urban space, ended up impacting everyone else. Especially, those of meager economic means, who were forced out of the central locations in the cities and could only find affordable housing in the far off suburbs.

The exodus of the underclass from the cities changed the very nature of suburban life, from a middle-class ideal to something more akin to economic refugees. Along with the dislocation, it led to a crisis of identity for the suburbs and an economic hit. Enter a perfect storm of strapped budgets, lack of true economic development, and the end of economic advance and mobility for working people. In short, in many ways, suburban failure is a perfect metaphor for the collapse and failure of the American dream.

Poverty is one of the reasons for the suburb’s decline in growth. According to “Confronting Suburban Poverty in America,” more than one in four suburbanites is poor or nearly poor across the United States. Poverty is also rising at much faster rates in the suburbs. Because of worsening health outcomes, higher crime rates, failing schools and fewer job opportunities, life has become harder for individuals and families, closing off the opportunity for escape and creating a cycle of intergenerational poverty. BBC News reported that suburban poverty affects an estimated 16.4 million locals in the US; and, if the trend continues, it could rise to 24.5 million by 2020.

Contributing Factors to the Suburban Poverty Crisis

Crime is also a factor for the suburban crisis. The Wall Street Journal says that over the last 10 years, violent crimes have exploded in the suburbs but tapered off in the cities. Suburbs are increasingly seeing gun, gang, and drug activities. According to the historian Kenneth, “People used to leave the city because they were afraid. Now, if you throw car crash danger in, you’re really in more danger in the suburbs than the city, most of the time.”

Economic mobility is becoming more challenging for suburb areas. For decades, suburbs were the places where everyone could work hard and succeed, but that has changed. The suburbs have become largely cut off from economic opportunity or mobility.

Cities have been the engines of economic progress and improvement in the 21^st century, and there are no signs that this trend will change anytime soon. But it has left the far-flung suburbs in a difficult predicament of falling tax revenues and a shift in population that is less affluent and educated. The social cohesion of the suburbs has largely collapsed and makes it difficult to find cooperative workable solutions.

In the interim, cities have enjoyed a renaissance as the creative classes rediscover the joys of urban life, café society, and museums and parks. Perhaps the solution for the suburbs is to incorporate some of these features into suburban life, in order to attract the newly affluent professionals.

Artificial Intelligence Threat to Jobs – Robots on The Rise

Posted on June 27, 2017July 31, 2024 by Staff Writer

The Fourth Industrial Revolution is upon us. And the world as we know it is coming to an end. Machines are a threat to humanity. Artificial intelligence (AI) will take our jobs . . . These statements are widely tossed around in relation to the AI boom over recent years, but are they based on fact or fiction? Here, Bold Business looks at the real uses and limitations of AI.

Elon Musk, “We need to be super careful with artificial intelligence. It is potentially more dangerous than nukes.”

Everybody knows that the concept of AI is based around computer systems performing tasks and functions formerly undertaken by humans. These tasks range from computation to translation, storage of information to speech and facial recognition, and now, a type of independent decision-making called machine learning.

According to Arrk, a global design and software services company, anything that involves a program doing something that would normally rely on the intelligence of a human is classed as artificial intelligence or AI.

This rather low bar is considerably different from what of us in the human world regard as AI. It is commonplace to assume that AI involves some sort of intelligence and judgment, but the truth is most of what is regarded as AI are very simple if/then functions and basic computation. Both of these are areas where computers truly excel.

AI May Replace or Automate Some Jobs

In a subject Bold Business has touched on before, in relation to computer systems taking the place of humans in the workplace, this threat is now real. Fukoko Mutual Life Insurance in Japan is a prime example. “In January 2017, they fired 34 employees after acquiring a new artificial intelligence system that could read medical certificates, gather data on hospital stays and surgeries, and, in the process, save the company an estimated 140 million Yen per year in salary costs,” Arrk reports.

In 2016, the World Economic Forum predicted that more than 5 million jobs will be lost to artificial intelligence over the next five years.

Although there are clear negatives to AI implementation, the consensus is that the sector will help improve humanity, not hinder it.

An example of positive gains is evident in many sectors where AI is being used to combat bank fraud, help improve education standards and prevent insurance fraud. An example of the latter, Tractable launched a system which flags suspicious claims and helps to reduce fraud and could save the insurance industry billions each year.

According to Technologist, some fret that artificial intelligence will end civilization as we know it. Others believe it can solve problems. The reality, however, is somewhere in between.

Several studies have predicted that the far-reaching implications of AI are much more positive than negative and the technology should be used to improve humanity and fundamentally help it. Experts predict that “intelligent machines will have a bold impact on how we work, how we move and even how wars are fought.”

Elon Musk Says We Have to be “Super Careful”

Elon Musk, one of the pioneers of creating a better world through innovation, said: “we need to be super careful with artificial intelligence. It is potentially more dangerous than nukes.” This statement sent shockwaves around the world. Coming from Musk, one of the world’s greatest technophiles, it really hit home how important AI is and how much of an impact it will make.

One of the most exciting developments surrounding AI of late is the concept of deep learning, which uses a brain-like processor to recognize patterns in large data sets. AlphaGO, devised by Google’s UK-based DeepMind, demonstrated this when it managed to beat a human in the ancient Chinese board game of Go. The game was thought to have been so complex that a machine could never beat a human, yet the machine triumphed over South Korea’s Lee Sedol, considered to be the world’s finest player, by four games to one.

“But data can come in a wide variety of forms, and in the last few years, the technique has been used to automate many other tasks that conventional programs struggle with, including identifying images, recognizing speech and even driving cars,” Technologist reports.

However, unlike humans, AI software is still unable to carry out multiple complex operations at the same time, but computer geniuses around the world are working hard to perfect this task. The onset of deep learning has set the AI wheels in motion again, as the endless possibilities of what can be achieved through the technology are yet to be realized. Leading physicist Stephen Hawking warned that AI could “spell the end of the human race” and the latest developments could throw up yet more debate in this forever evolving industry. Only time will tell!

Day: June 27, 2017

Jamaica Explores Public Private Partnerships

Understanding Public-Private Partnerships Better

Countries that Practice Public- Private Partnership

Other Public-Private Partnership Plans for Jamaica