Governor defends economic plan as first year closes

TNI report on Public-Private Partnerships
31 December 2009
In the media

Passing government tasks to the private sector is not a guarantee of a fiscal payoff for government or the optimization of services for the public.

Published at
Caribbean Business

Gov. Luis Fortuño defended his economic strategy Thursday as the clock wound down on his first year in office.

The governor touted the passage of a sweeping permits system overhaul and a comprehensive public-private partnership (PPP) law as key pillars in his administration’s efforts to shore up the island’s sagging economy, which is nearing a fourth year of recession.

Fortuño reiterated the importance of PPPs to fund vital public works that the cash-strapped government cannot afford to undertake alone. He shrugged off critics of PPPs as a failed model. A study published by the Transnational Institute, a global online research and activism, noted that in Italy “privatization of the highways has increased costs and inefficiency.”

“Public-private alliances have not failed. In England and Spain, PPPs are something that leftist, rightist and centrist governments alike have used successfully for decadesand that’s where we looked in creating this model,” the governor told CyberNews news services.

The Transnational Institute study further found that passing government tasks to the private sector is not a guarantee of a fiscal payoff for government or the optimization of services for the public.

Fortuño, however, reiterated that a wide-range of PPP projects were being eyed, including the private operation of Luis Muñoz Marín International Airport.

“The airports in Lima, Peru, in San José, Costa Rica, the six airports in the Dominican Republic, all were taken into PPP concessions. The number of passengers went up, facilities improved and jobs were created. The examples have been positive,” he said.

Fortuño said the work of his administration in 2009 laid the groundwork for a long-term plan that will stretch beyond his administration and should be continued by his successors in La Fortaleza.

“This economic effort should not be confined to political terms,” hesaid.

“The idea is that it serve as a framework when I am no longer governor, that I need not be in office for it to be implemented,” Fortuño said in relation to his administration’s Integrated Sustainable Development Plan (PIDES by its Spanish acronym).

The governor said that in 2010 and for the rest of his term, increased focus will be given to the development of the tourism industry, building on momentum from tourism-related legislation passed earlier this month.

“Tourism must play a major role in this long-term plan. Seeing that there is possibility and potential for growth in this first year we adopted some eight measures that will give us additional tools for growth in tourism. But we are not done. I understand that we have much more to do,” he said.

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