Public sector 'can benefit from private expertise'

Dubai: The public sector could benefit from the private sector's experience when dealing with mega projects, said Mahdi Ismail Al Jazzaf, Middle East executive director of the World Bank.

He said that the GCC region is enjoying a boom due to the high oil revenues and people should concentrate on investing this fortune in the right ways.

"There are some negative indications coming with these 2005 revenues, like the unstudied expansion in mega projects, low productivity and the retreat of the private sector," said Mahdi.

Bonds

"A part of the revenues was invested in the past in European and American banks, especially in bonds. Now there are a lot of investment opportunities in the emerging markets," he added.

The challenge, he said, is how to invest these recent revenues and balance between expenditure and savings.

Sharing risk

"We advise the GCC government to diversify its investments geographically and to balance between social and investment spending" said Mahdi.

He added that it is important for governments and the private sector to share the risk in large developments.

"Risk sharing gives the governments a real idea about the mega projects they are planning to launch. The private sector has better judgment than government in these long term projects, " he added.