Public-Private Partnership Stories
Nigeria: Cross River State Hospital
Illustration © Cuningham Group of Architects
Cross River State, with just over 0.5 hospital beds per thousand people, has the lowest
density of hospital infrastructure in the South-South region of Nigeria. While there
is nascent private sector involvement in the health sector, most health care delivery
is provided by the state; however, the network of public sector hospitals and health
care centers does not meet the region’s needs. The government of Cross River State
hired IFC as lead transaction advisor to support the structuring and implementation
of a public-private partnership (PPP) for a new referral hospital in the capital city of
Calabar that will deliver an affordable international standard of health care for the
state.
A 10-year concession was awarded to UCL Healthcare Services Ltd, an international
consortium comprising Utopian Healthcare Consulting (U.S.), Cure Hospital Manage-
ment Services (U.S.), Cuningham Group (U.S.), Consultants Collaborative Partnership
(Nigeria), ITB Nigeria Limited (Nigeria), HealthFore Technologies (India), and Simed
International (the Netherlands). The consortium will bear some project development
costs, deliver a turnkey hospital, and will be responsible for operating the hospital
under the terms defined in the PPP agreement.
The PPP agreement was signed on June 24, 2013. The hospital will be operational
in 2015.
This series provides an overview of
public-private partnership stories
in various infrastructure sectors,
where IFC was the lead advisor.
The hospital is expected to provide high quality advanced secondary
IFC Advisory Services in clinical and diagnostic services to the citizens of Cross River State,
Public-Private Partnerships
2121 Pennsylvania Ave. NW particularly to the citizens of the greater Calabar area.
Washington D.C. 20433
ifc.org/ppp
BACKGROUND be financed by the state government. The consortium will bear
The hospital facilities in Cross River State are inadequate: in some project development costs, deliver a turnkey hospital, and
addition to deteriorating infrastructure and a lack of skilled staff, will then be responsible for running the hospital operations under
the facilities lack advanced medical equipment. As a result, the terms defined in the PPP agreement. At the end of the concession
quality of public health care services is sub-optimal. Moreover, the period, the facility will be transferred to the government. The
population perceives the quality of healthcare as poor, resulting hospital will be managed as a state referral hospital, providing
in a loss of confidence in the facilities, a greater reliance on self- quality and affordable access to regional level clinical services.
medication, and an exceptionally high rate of medical evacuations
to other countries. The lack of advanced diagnostics is a serious BIDDING
problem and patients are often forced to travel to neighboring Fifteen international firms responded to an invitation for
states for imaging services; there is also limited access to quality expressions of interest issued by the government in April 2012,
high-risk obstetric care, intensive care units, and to emergency/ and four of these firms were prequalified. Two bids, comprising
trauma care. technical and financial proposals, were ultimately received. The
With a population of approximately 3.4 million people, a shortage consortium led by UCL Healthcare Services presented the lower
of doctors exacerbates the state’s healthcare problem. Apart financial bid and was awarded the contract. The consortium
from the federally-funded teaching hospital, only 36 doctors includes, among others, Cure Hospital Management Services, a
and 938 nurses employed by the state cover the state’s secondary U.S.-based firm which will provide clinical services, and Simed
health facilities. This number translates into an alarming doctor- International, a Dutch firm which will deliver the medical
population ratio of 0.21 doctors per 10,000 patients—one-fifth equipment.
of the Sub-Saharan African average.
To confront these challenges, the Cross River State government
proposed the establishment of a 105-bed referral hospital to serve
the needs of the capital city, Calabar, and its environs. A gateway
clinic will be included, offering primary healthcare services and a
solid referral mechanism for the PPP hospital, ensuring that only EXPECTED POST-TENDER RESULTS
patients requiring secondary care are admitted to the hospital.
The government sought IFC’s support to attract the participation • The hospital is expected to provide high quality
of qualified private sector firms in the design, construction, advanced secondary clinical and diagnostic services
equipping, and management of the proposed hospital through a to the citizens of Cross River State, particularly to
transparent tender process. the citizens of the greater Calabar area.
• 66,000 expected unique patients per year.
IFC’S ROLE
• The hospital will play a role in the state govern-
In September 2011 the government of Cross River State engaged
ment’s overall growth strategy by creating jobs.
IFC as lead transaction adviser to help implement all aspects of
the PPP project. IFC conducted a detailed feasibility study to • Health professionals in the state will build expertise
determine how private participation in the proposed facility could through exposure to international best practice.
improve healthcare outcomes. IFC recommended seeking a private
operator through a competitive tender to design and construct the 06/2013
hospital, and to manage all clinical and non-clinical facilities. IFC
worked closely with the government to structure and implement
the transaction, guiding the government through a transparent
tender process, including the preparation of PPP contract
documents, evaluation of technical and financial bids, and signing
of the final contract agreement.
TRANSACTION STRUCTURE
The 10-year project term will include up to two years for
construction and eight years for operation. The hospital is
anticipated to be operational in 2015. The construction and
equipping of the hospital, totaling approximately $37 million, will