Lithuania approves four prison PPPs

Having already got a road PPP programme underway, Lithuania is now seeking private sector help for social infrastructure projects.

The Lithuanian government has approved a new “Prison Modernisation Programme”, with the aim of modernising its detention facilities by 2022. Four of the proposed projects making up the programme will be implemented on a public-private partnership (PPP) basis.

The programme includes the construction of a new remand prison on the outskirts of capital city Vilnius as well as in Siauliai, Klaipeda and Panevezys, as well as the completion of Pravieniskes Prison.

Lithuania is allocating more than €30 million in state budget funds to the programme with a further €3.5 million coming from Norwegian Financial Mechanisms, a form of foreign aid provided by Norway to certain European Union (EU) member states. These funds do not include the projects to be implemented on a PPP basis.

“The programme accommodates four PPP projects attractive to investors,” said Jonas Kimontas, project manager at Invest Lithuania – a government body responsible for attracting foreign investment and PPP promotion – in a statement. “We can see that they are already generating interest and we expect that competent companies with expertise in such projects will ensure proper competition during the tenders.”

The statement said that the Vilnius detention facility, comprising 1,620 beds, will be the first project to be tendered, with a Request for Qualifications (RFQ) expected in the middle of next year. The second project in the pipeline will be the Siauliai detention facility, with 800 beds.

With a population of only around 3 million, Lithuania is becoming something of a cheerleader for PPPs in the Baltic States. Last month, the country’s Ministry of Transport and Communications requested government approval to proceed with the €175 million Vilnius-Utena highway PPP project. This followed financial close on a pilot road project – the €36 million Palanga Bypass PPP – in May 2013.

With one of the fastest growing economies in the EU, Lithuania is ranked 17th globally in the World Bank’s “Ease of Doing Business” index in 2014.