"A public–private partnership (PPP, 3P, or P3) is a long-term arrangement between a government and private sector institutions."
This topic explores the different approaches to structuring PPPs, including contractual frameworks, partnership models, and procurement processes.
Definition and concept of PPP: Understanding what PPP is, its main features, and its objectives.
PPP models and structures: Knowing the different PPP models and structures, such as the concession, joint venture, and build-operate-transfer models.
PPP phases and stages: Understanding the different phases and stages of a PPP project, such as the pre-feasibility, feasibility, procurement, implementation, and monitoring phases.
PPP legal and regulatory frameworks: Knowing the legal and regulatory frameworks that govern PPP projects, including the contractual provisions and the regulatory framework for PPPs.
PPP risks and risk management: Understanding the risks and how to manage them in PPP projects, including financial risks, political risks, legal risks, and other risks.
PPP financing: Knowing the different financing options for PPP projects, including public financing, private financing, and blended financing.
PPP procurement and tendering process: Understanding the procurement and tendering process for PPP projects, including the different models such as design-build-finance-operate (DBFO) and design-build-operate (DBO).
PPP contract management: Understanding the different aspects of PPP contract management, including contract negotiation, monitoring and evaluation, and dispute resolution.
PPP sustainability and social impact: Knowing how to ensure the sustainability of PPP projects and their impact on society, including environmental and social aspects.
PPP international best practices and case studies: Learning from the experience of other countries and studying best practices and successful case studies of PPP projects from around the world.
Build-Operate-Transfer (BOT): Private sector partner finances and operates the project for an agreed period, after which ownership and operational control is transferred back to the public sector.
Build-Own-Operate (BOO): Private sector partner finances, builds and operates the project for the duration of the contract, and owns the assets throughout the term of the agreement.
Build-Lease-Transfer (BLT): Private sector partner finances and builds the project, leases it to the public sector for an agreed period, and then transfers ownership back to the public sector at the end of the lease.
Design-Build-Operate (DBO): Private sector partner designs, builds and operates the project, which is then transferred back to the public sector at the end of the contract.
Concession: Private sector partner is granted exclusive rights to finance, design, build, operate and maintain a project, in exchange for payment from the public sector or through user fees.
Management Contract: Private sector partner provides management services for the operation and maintenance of a public service or asset, for an agreed fee.
Joint Venture: Public and private sector partners form a separate legal entity to jointly develop, finance and operate a project or service.
Risk and Revenue Sharing Agreement: Public and private sector partners share risks and revenues from a project, in order to reduce the financial burden on both parties.
Service Contract: Public sector contracts out the provision of a specific service to a private sector partner for a set period of time, with payment based on performance.
Enhanced Use Lease (EUL): The public sector leases underutilized real estate to a private sector partner, for development and management, generating revenue for both parties.
"They were seen by governments around the world as a method of financing new or refurbished public sector assets outside their balance sheet."
"PPPs have been employed for building, equipping, operating, and maintaining schools, hospitals, transport systems, and water and sewerage systems."
"PPPs are always paid for either through taxes or by users of the service, or a mix of both."
"Typically, it involves private capital financing government projects and services up-front."
"Drawing revenues from taxpayers and/or users for profit over the course of the PPP contract."
"PPPs are structurally more expensive than publicly financed projects because of the private sector's higher cost of borrowing."
"PPPs are controversial as funding tools, largely over concerns that public return on investment is lower than returns for the private funder."
"PPPs are closely related to concepts such as privatization and the contracting out of government services."
"PPP advocates highlight the sharing of risk and the development of innovation."
"The secrecy surrounding their financial details complexifies the process of evaluating whether PPPs have been successful."
"Evidence of PPP performance in terms of value for money and efficiency, for example, is mixed and often unavailable."
"Contemporary 'public-private partnerships' came into being around the end of the 20th century."
"They were aimed at increasing the private sector's involvement in public administration."
"PPPs have been implemented in multiple countries."
"PPPs have been employed for building, equipping, operating, and maintaining schools, hospitals, transport systems, water and sewerage systems."
"Cooperation between private actors, corporations, and governments has existed since the inception of sovereign states, notably for the purpose of tax collection and colonization."
"PPPs also have high transaction costs."
"A long-term arrangement between a government and private sector institutions."
"Critics decry their higher costs and issues of accountability."