Abu Dhabi Investment Office Promotes Public-Private Partnerships (PPP)

Post by: Omar Nasser

Photo : Abu Dhabi Media Office

Abu Dhabi Investment Office (ADIO) is working to improve the Public-Private Partnership (PPP) system in Abu Dhabi. This will help bring in AED 2.4 billion for PPP projects between 2020 and 2024, making Abu Dhabi a top place for investment.

PPP projects are important because they combine the government and private companies to create projects that help the economy grow. The World Bank says that PPP investments in developing countries reached US$83 billion in 2020, even with global challenges. The World Economic Forum (WEF) says PPPs can help solve the problem of financing for infrastructure, which needs US$15 trillion by 2040. A report by McKinsey says that PPPs can also lower costs by 25%.

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PPPs help the public sector by introducing new technologies and improving management skills. The World Bank explains that these partnerships make the government more efficient by giving them access to private sector knowledge. According to PwC, PPPs can improve public sector work by 30% and speed up the use of new technology by 40%. The Organisation for Economic Co-operation and Development (OECD) says countries using PPPs see 1.5% more economic growth every year.

ADIO is helping Abu Dhabi’s PPP system grow by creating partnerships with local and international companies and government bodies. This makes the city more competitive and boosts the economy. In Abu Dhabi, PPPs help private businesses become part of public projects in important sectors like renewable energy, transport, and healthcare.

A great example of a PPP project is the Zayed City Schools project. This is the first school project in Abu Dhabi done with a PPP system, in partnership with the Abu Dhabi Department of Education and Knowledge (ADEK). Three new schools will be built for over 5,000 students, from kindergarten to high school. The 22-year contract was given to a group of companies led by BESIX, a Belgian construction company, and Plenary Group, an Australian investor. This shows how private companies can help meet public needs.

Another example is the Abu Dhabi LED Street Lighting Project. This project will replace 176,000 streetlights with energy-saving LED lights. This will save energy, lower emissions, and make roads safer. The project is being done in two parts. The first part was awarded to a local company called Tatweer, and the second part to a group of French companies, EDF and Engie. This project shows how PPPs can help improve the environment.

ADIO also finished the tender process for the Khalifa University student housing project. This will be the largest student housing project in the region, with 3,260 rooms and shared facilities across two campuses. This is the first PPP project to include the In-Country Value (ICV) scheme, which helps support local businesses by buying goods and services from the UAE. The 23-year contract was given to a group called KUnnected Living, which includes Plenary Group, BESIX, and Mazrui International, working with Khalifa University. This project shows how PPPs can help national goals and the economy.

ADIO’s PPP projects are expected to create almost 5,000 construction jobs and 450 jobs in daily operations, helping local workers. These projects also save money. ADIO and the Department of Finance – Abu Dhabi (DoF) have saved AED 1.4 billion in capital costs, running costs, and energy costs.

ADIO’s careful planning and deal-making have earned global recognition. The Zayed City Schools and LED Street Lighting projects won the "Deals of the Year" award at the IJGlobal Awards in 2022 and 2023. This has improved Abu Dhabi’s reputation for high-quality projects.

ADIO has also helped improve the rules and systems for PPPs. Together with the Department of Finance (DoF), ADIO created new accounting and budgeting rules that help attract more investment. This is making Abu Dhabi a leader in public-private partnerships.

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