Problems of public-private partnership in implementation of strategic projects of the North

Abstract

In the phase of its economic growth in 2002–2008, Russia returned to the development and implementation of strategic complex megaprojects aimed at creating a new infrastructural and industrial base in the Russian Federation and the development of natural resources, located in the North, including the Arctic shelf areas, which are currently in demand on world markets. This increases the significance of coordinating the government economic and social policies in the North, making them consistent with the long-term geoeconomic strategy of developing the North as a part of the economic space of Russia and global Arctic. Megaprojects in the North pursue geopolitical, macroeconomic, and socioeconomic goals, but priority is given to market objectives, i.e., high economic efficiency for both state-owned and private companies. The article describes the characteristics and properties of strategic megaprojects of the Russian North, discusses the state management of their implementation, and the role of the government in the mitigation of geopolitical and management risks for corporations and regions participating in the megaproject. It is shown that public-private partnership (PPP) is a strategic direction for the implementation of complex northern megaprojects. The fundamental problem in choosing the PPP form is the adequacy of the megaproject complexity to the structure of its participants’ production and financial assets. An analysis of organizational and economic risks, which are inherent in northern megaprojects implemented on the basis of PPP principles, such as “Complex Development of Southern Yakutia,” “Complex Development of the Lower Angara Area,” “Complex Development of the Transbaikal Area,” and “Ural Industrial-Ural Polar,” is presented. It is shown that the government and business faced with the problem of inefficient coordination of management decisions made by businesses and federal subjects by federal executive authorities. This problem can raise doubts about the effectiveness of large businesses’ participation in a megaproject and therefore undermine the implementation of that megaproject in general. The authors propose to evaluate the PPP effectiveness by assessing the degree of consistency in the long-term geopolitical, economic, and social interests of participants in the development, i.e., federal and regional executive authorities responsible for addressing specific cross-sectoral and interregional issues and corporations implementing strategic projects in the North. The government’s role consists in maintaining a comprehensive interaction between companies ensuring balanced development and in the mitigation of geopolitical, innovation, and production (development) risks in the North. A methodical approach is proposed to the development of organizational patterns for the interaction between the government and business on the basis of PPP principles; federal-level coordination problems are substantiated, the objects of PPP are identified, and the forms of agreements between investing companies and the government are determined. The necessity is proved to create a federal coordinator at the predesign stage of megaprojects. The federal coordinator communicates with regional corporations regarding issues of strategic project implementation, which will significantly accelerate the managerial decision-making process. By way of example, the case of the megaproject for developing the East-Siberian Oil and Gas Complex (ESOGC) is considered and recommendations are worked out for stating coordination problems for the ESOGC, defining the subject of agreements and contracts between companies and the government for the implementation of projects, taking into account time and the achievement of acceptable efficiency levels of investments in private projects.