BAKU, Azerbaijan, May 17. Azerbaijan's experience demonstrates the importance of flexible public-private partnership (PPP) models in the housing sector, the Director of PwC Azerbaijan, Gunel Sadiyeva, said during the Business Assembly session dedicated to public-private partnerships, held within the framework of WUF13 in Baku, Trend reports.
According to her, a model emerged across the post-Soviet space, including Azerbaijan, since the early 1990s, where a significant portion of the population gained ownership of their housing.
"However, decades later, many of these houses have become outdated and unsafe, creating a need for their renovation and replacement with new housing. In Azerbaijan, to address this problem, a mechanism of so-called 'pilot projects' is applied. Under this framework, old residential buildings are demolished, and private developers build modern residential complexes in their place. At the same time, the land for development is transferred to the private sector, which allows compensating for costs through the market sale of the new housing," the director said.
She also recalled that similar approaches have been applied in other countries of the region, including Kazakhstan, where private companies were involved in updating the old housing stock with an obligation to ensure the resettlement of residents.
Separately, Sadiyeva emphasized the importance of improving the regulatory and legal framework for the development of PPPs.
According to her, despite the existence of the law on public-private partnership, its practical application remains limited due to insufficiently developed mechanisms, including issues of land transfer, risk allocation, and the return of facilities to the state after project completion.
As an example, she cited a project for the construction of a student dormitory under the PPP model (build-operate-transfer), where regulatory gaps persisted, including issues of tax incentives and facility transfer procedures after the completion of operations: "Despite support from regulators, including the Ministry of Economy, implementation faced insufficient coordination between government agencies."
She noted that the key condition for the successful development of PPP is not only the availability of legislation, but also an effective dialogue between all government bodies and the private sector, as well as the predictability and transparency of project implementation rules.
