Feasibility studies on how to apply public private partnership (PPP) models to fund individual or bundled projects are starting in Saudi Arabia.

The activity is in sectors including education, health and transport. The main focus is on projects that are already planned, and how they can attract private sector investment.

Consultants expect that the first Saudi PPP projects will be in the market in 2017.

Riyadh has promised to amend personnel laws to allow staff to be seconded to PPP developers and concessionaires. Consultants say they are not aware of any decision to move ahead with creating a wider PPP or privatisation framework.

The proposed amendments will be a key step towards successful PPP procurement in Saudi Arabia, an important element of the Vision 2030 and National Transformation plan.

”There is an intent at many levels to explore alternative means of financing capital expenditure, and involve the private sector,” says Maarten Wolfs, ?partner and Middle East project & infrastructure finance leader at PwC. “It’s certainly worthwhile investing in setting the correct foundations and policy frameworks for PPPs to ensure they are bankable and actually attract foreign direct investment.”

This would make structuring bankable projects simpler, by clarifying the roles of the Ministry of Finance, public sector clients, the private sector and lenders. It would also allow investors to see how payments would be made, and what guarantees they may expect.

PPP can be carried out without a framework, for example Turkey-based TAV’s Prince Mohammed bin Abdulaziz International Airport near Medina.

Standard regulations would simplify the transactions, give confidence to investors and reduce delays.

“There’s no framework that allows you to package and bring in an investor to upgrade or operate the assets,” says one lawyer. “They’re doing feasibility studies, but then for the next step there is a lot of work required and things may grind to a halt.”

Projects may currently need case-by-case high level approval to bring in private investors.

Oman and Qatar are currently in the process of preparing PPP legislation, which can take over a year.