TRADE, DEVELOPMENT AND PUBLIC PRIVATE PARTNERSHIPS AN ANALYSIS OF PPP IN HEALTH FACILITIES: A WAY OF IMPROVING TRADE IN HEALTH SERVICE? Authors: Changsik Cho Fatima Yaagoub Feifei Lu Janaina Zen Instructed by: Prof. Raymond Saner Marie Sudreau SCIENCES PO PARIS & UNITED NATIONS ECONOMIC COMMISSION FOR EUROPE This report is the result of the work carried out for the Capstone Project by Master degree students of the MPA programme of Sciences Po, Paris. A Capstone Project is a requirement for all second year MPA students. It is a client-based consultancy whose subject is a concrete policy issue and that is carried out by small groups of students (between three to five students). It is based on a series of parallel and complementary activities: secondary research, mentoring & coaching, teamwork, field study visits, and a professional outcome or “deliverable”. This project is a professional group experience that demands effective team work. Each group receives a collective grade. The learning experience of a Capstone Project consists of managing the sometimes difficult interaction within the group, as much as applying in practice the theory learnt in the courses. A Capstone Leader supervises, advises and monitors the work of the students and their exchange with the representatives of the client organisation. Each Capstone Leader meets regularly with the students and guides them throughout the project: from the initial research, to the fieldwork, contact with the client, draft the report and final presentation. The authors are responsible for the choice and presentation of the facts contained in this report and for the opinions expressed therein, which are not necessarily those of the MPA and do not commit the MPA Programme. ACKNOWLEDGEMENTS We would first like to thank our supervisors Professor Raymond Saner and Marie Sudreau for their constructive suggestions and guidance, which have been the invaluable to the structure, development and delivery of this research report. We are truly grateful to our client, United Nations Economic Commission for Europe (UNECE), for providing this great opportunity of studying the Public Private Partnerships Health in developing countries, especially, Mr. Geoffrey Hamilton. We extend our sincere gratitude for their most helpful instructions in Geneva. We particularly thank Mr. Celso Manangan for his great accompany and assistance throughout the Philippines field study. We appreciate kind cooperation and insightful inputs from our partners and interviewees in Switzerland, the Philippines and Turkey. We thank the Centre for Socio-Eco-Nomic Development (CSEND), for helping us arranging the trip to Geneva and introducing the research team to all relevant institutes. In Geneva, we would like to thank GAVI, The Global Fund, The Graduate Institute, UNAIDS, United Nations Conference on Trade and Development (UNCTAD), World Health Organization (WHO), and World Trade Organization (WTO) for taking their valuable time and generously sharing their knowledge. In the Philippines, we would like to thank Amang Rodriguez Medical Center, Asian Development Bank, Asian Institute of Management, Ateneo Graduate School of Business, Ateneo School of Medicine and Public Health, Banco De Oro, Business Development Group, United Laboratories, Inc., Delegation of the EU in the Philippines, Department Of Health, Development Bank of the Philippines, DOH Center of Excellence on Public-Private Partnerships in Health, Fresenius Medical Care Phils., Inc., Makati Medical Centre, Medilink Network, Inc., National Kidney and Transplant Institute, Philippine Health Insurance Corporation, Philippine Institute for Development Studies, Public Private Partnership Center of the Philippines, Quirino Memorial Medical Center, Tala Medical Center, University Of Philippines - National College of Public Administration And Governance, as well as Mr. Hector Florento and Mr. Lauro A. Ortile for their active responses and prescient comments. In Turkey, we would like to thank the invaluable contribution of American Hospital, Department of Health Istanbul Provincial Offices, European Investment Bank, Galatasaray University - Economics Faculty, International Finance Corporation (IFC), World Bank Group, Istanbul Mehmet Akif Ersoy Hospital, Istanbul Technical University, Department of Management Engineering, Kolcuoglu-Demirkan (Attorneys at law), Korea Trade & Investment Promotion Agency, Sabanci University, Sabanci University - Istanbul Policy Center, and Turkey International PPP Platform. 2 We would also like to thank Cambridge University and OECD Paris (Budgeting and Public Expenditures Division, Public Governance and Territorial Development) for accepting our interview requests and sharing their profound opinions. Finally, we are deeply grateful to the MPA administration and to our program director Prof. Erhard Friedberg for their guidance, patience and persistent help. The Capstone team Changsik Cho, Fatima Yaagoub, Feifei Lu, and Janaina Zen Paris – April 2012 3 TABLE OF CONTENTS Acknowledgements .................................................................................................................. 2 List of abbreviations and acronyms ....................................................................................... 1 Executive Summary ................................................................................................................. 3 1. Introduction ........................................................................................................................... 5 2. Study Objectives .................................................................................................................. 6 3. Relationship Between Trade and PPPs .............................................................................. 7 PPP as a response to the challenge .................................................................................................. 9 4. Public Private Partnerships in Health ............................................................................... 11 Typologies ......................................................................................................................................... 12 5. Conceptual Frameworks .................................................................................................... 13 5.1. The Main Drivers of PPPs .......................................................................................................... 13 5.2. Theoretical and Analytical Underpinnings .............................................................................. 15 5.3. Summary ..................................................................................................................................... 20 6. Research Questions ........................................................................................................... 23 7. Research Methodology ...................................................................................................... 25 Limitations ......................................................................................................................................... 28 8. PPPH in Developed Countries: Best Practices and Lessons Learned .......................... 29 Canada ............................................................................................................................................... 30 Germany ............................................................................................................................................. 38 Portugal .............................................................................................................................................. 46 United Kingdom ................................................................................................................................ 51 9. Hands-On Experiences: PPPH in the Field ...................................................................... 63 Philippines ......................................................................................................................................... 64 1. Political Background ...................................................................................................................... 64 2. Health Care in the Philippines ........................................................................................................ 64 3. PPPH project features in the country ............................................................................................. 68 4. Four themes focal research in the Philippines ............................................................................... 69 5. Other related information collected in the field study ..................................................................... 87 6. Recommendations ......................................................................................................................... 88 Turkey ................................................................................................................................................ 93 1. Introduction .................................................................................................................................... 93 2. Health Care in Turkey .................................................................................................................... 93 3. PPPH project features in the country ..........................................................................................