Factors influencing the consideration of Public-Private Partnerships (PPP) for smart city projects: Evidence from Hong Kong

Abstract

Smart cities are emerging in most parts of the world. The cost-benefit analysis of such initiatives should include an unbiased consideration of potential procurement modes, especially when a substantial investment is entailed to scale up projects to the city level. Despite the enticing trend of public private partnerships (PPPs), city governments should evaluate the available options using an objective approach such as Multi-Attribute Utility Analysis (MAUA). The technique takes into account prioritized assessment criteria (which are tailor-made for smart city projects) and the relative utilities of the procurement options in meeting the criteria.The methodology of MAUA is demonstrated through a questionnaire survey and a focus group meeting involving public and private sector practitioners, and applied to 8 types of common smart city projects in Hong Kong, which is one of the metropolises earmarked to become a smart city by putting concepts into practice. Results show that not all projects are best suited to PPP and that there may be divergent views between the public and private sectors, with possibilities for a compromised decision which both sectors would accept.