Public-Private Partnership Concerning Infrastructure Projects in a Resource Region: A Model Based on a Consortium of Subsoil Users

Introduction. The article explores the development of the institution of public-private partnership in Russia, the United States, France and Japan, emphasizing the key features of the legal systems of these countries and their impact on the implementation of large-scale infrastructure projects. The study highlights the essential role of harmonization of the legal and regulatory framework for the successful development of public-private partnership, which requires taking into account the interests of both the public and private sectors.Materials and methods. The study is based on the following general scientific and special methods: classification, analysis, synthesis, comparative-legal method, system-structural method, technical-legal method, OSINT analysis and study of casual law applied in public-private partnership regulation.Research results. The paper identifies the main characteristics and differences in the public-private partnership legal systems of Russia, the USA, France and Japan. The Russian regulatory framework governing public-private partnerships is based on the Federal Law No. 225-FZ «On Production Sharing Agreements» dated 30 December 1995, the Federal Law No. 115-FZ «On Concession Agreements» dated 21 July 2005 and the Federal Law No. 224-FZ «On Public-Private Partnership, Municipal-Private Partnership in the Russian Federation and Amendments to Certain Legislative Acts of the Russian Federation» dated 13 July 2015. These federal laws establish the legal framework for the implementation of PPP projects, determine the forms of interaction between public and private partners, as well as regulate the procedure for the conclusion, execution and termination of the relevant agreements. However, despite the development of the existing legal framework, there are certain shortcomings in the Russian practice of PPP project implementation. Primarily, the following should be attributed to them:- The presence of inconsistencies between regional PPP legal regulation and federal regulation: along with federal laws, the constituent entities of the Russian Federation have their own regulations governing PPPs, which may lead to legal fragmentation and complicate the unification of legal approaches to this institution;- High transaction costs: complexity and duration of PPP project approval and implementation procedures increase costs for the participants;- Lack of a single coordinating structure at the federal level: currently, infrastructure projects implemented on the basis of PPPs are subject to approval by the federal or regional executive body in charge of the infrastructure project, which may create different practices of implementation of similar/ contiguous infrastructure projects.The above deficiencies are compounded by frequent changes in legislation, which creates uncertainty and reduces the attractiveness of the public-private partnership model. in Russian infrastructure projects for private investors. Against this background, the Japanese public-private partnership model stands out for its long-term strategic orientation and effective use of the build-transfer-ownown model. This model minimises the tax burden on private partners while ensuring state ownership of infrastructure facilities, which makes projects both economically efficient and socially significant. In France, on its part, despite the diversity of publicprivate partnership models, the legal regulation of different forms of public-private partnerships is harmonised and there is a clear distinction between concessions and public-private partnership contracts.Discussion and conclusion. Based on the analysis, recommendations for improving the legal regulation of public-private partnerships in Russia have been proposed. These include harmonisation of regional and federal legislation, reduction of transaction costs and development of special economic regimes providing for the legislative enshrinement of preferences, benefits and guarantees for private (including foreign) investors involved in the implementation of large infrastructure projects on the basis of public-private partnership. In addition, special attention should be paid to the development of a unified institutional structure for the management of public-private partnership participants' projects. The implementation of the above measures will create conditions for attracting private investment, increasing the efficiency of infrastructure projects implemented on the basis of public-private partnership

Public-private partnership (PPP) concession agreements are awarded by National, State and local public agencies that contract with private companies to finance and deliver infrastructure as a long term service to governments and their citizens, rather than having the private firms design and build infrastructure assets to be financed, operated—and, hopefully, maintained—by government. PPPs are similar to the emerging model of selling business or personal software as a cloud-based service (SaaS) rather than as a product licensed by the user—a model that that has transformed and disrupted the enterprise software industry. Australia is a world leader in PPP infrastructure delivery, and has had over two decades of experience in delivering civil and social infrastructure services to its citizens via PPP concessions. Along the way, the public and private participants in infrastructure PPPs have developed practices and a mature institutional framework necessary for this kind of long-term, risky public-private commercial partnership. This study reports the findings from in-depth interviews with 25 senior executives of public and private participants in PPP infrastructure projects from the three Eastern Australian States with the longest history of PPP delivery. Based on the results of those interviews, we develop a governance model for infrastructure service delivery: the government selects infrastructure projects, guided by a non-partisan, expert infrastructure prioritization panel, and contracts for the delivery of these prioritized infrastructure services with a private concessionaire financed by long-term institutional investment capital. The concessionaire is a private entity in charge of financing, designing, constructing, operating, and maintaining the infrastructure service. The government supervises the infrastructure service, to safeguard public interest. The government also provides an institutional framework, with contracts and authorities necessary for the interaction between the public and private actors.

Public-private partnership (PPP) is considered one of the effective instruments for collaboration between the government and the private sector in stimulating economic development. PPP can catalyze entrepreneurial growth, foster a favorable business environment, and accelerate infrastructure and socio-economic projects. This research aims to develop theoretical and methodological approaches to ensure public-private entrepreneurial development partnerships. Public-private partnership (PPP) is recognized as a driving force for entrepreneurial development, as it opens new prospects and opportunities for creating a favorable business environment. Ukraine's public-private partnership's entrepreneurial development principles have been formulated. The objectives and tasks of the program for the development of public-private partnerships for entrepreneurial development have been systematized, including goals and studies aimed at supporting and stimulating entrepreneurship through public-private partnerships: creating a favorable investment climate; supporting small and medium enterprises; fostering innovative entrepreneurship; expanding export potential; promoting sectoral collaboration. The main directions for establishing public-private partnerships in Ukraine for entrepreneurial development have been proposed. The following methodological approach is suggested to ensure a successful public-private partnership for entrepreneurial development, which includes the following stages: analysis of needs and goals, development of a strategy for public-private partnership for entrepreneurial development, improvement of the legislative framework, the establishment of communication mechanisms, financial support, creation of a favorable regulatory environment, support for education and training, monitoring and evaluation of joint PPP projects. This methodological approach will help create a conducive platform for public-private partnerships and contribute to entrepreneurial development. Research on the principles, methods, and directions for implementing public-private partnership mechanisms has allowed the construction of an organizational and economic model for its functioning with the aim of entrepreneurial development, enabling effective coordination among enterprises, market institutions, and government bodies for joint entrepreneurial development and the achievement of positive socio-economic results. Recommendations have been developed to ensure public-private partnerships for entrepreneurial development, which will contribute to economic growth. Keywords: public-private partnership, entrepreneurship, socio-economic development, business.

The need for adequate supply of infrastructure has long been viewed as a key ingredient for economic growth and sustainable development, both in the academic literature and policy debates. With the quest for economic development by governments in developing countries and the consequent emergence of public-private partnerships to deliver major infrastructural projects on time, within the approved budget and in accordance with the preset specifications. A linkage can be established between Sustainable infrastructural development and Project management. This will be seen from the need to maximize success in infrastructural projects that will deliver integrated social, economic, and environmental concerns. In this setting, there would be need for the recruiting of multi-disciplinary teams with specialist backgrounds to implement these infrastructural projects. The question to ask is if project management as a profession is adequate in the delivery of a steady stream of experts to carry out needed project management activities in infrastructural development? We present evidence that project management is being increasingly seen not as a profession with a clear educational path, but as a skill that can be acquired with experience and as a second degree specialization. We also present evidence that shows that project management is not highly competitive in tertiary institutions in our Nigerian case-study and this may be as a result of a lack of clear understanding of the profession of project management. We argue that there is an urgent need for harnessing the development potential of project management as a structured profession with a clear educational path; such that project managers can begin to take on the task of delivering sustainable infrastructural projects. They are to ensure that in the execution of these projects; the economic role of these infrastructural projects should not be accorded ‘precedence’ over the other dimensions of sustainable development – the social, cultural and environmental aspects. Key words : Sustainable development; Infrastructural projects; Project management; Education; Nigeria; Economic growth

One alternative to accelerate infrastructure development in Indonesia is by involving the private sectors in the financing and development. In principle, Public Private Partnerships (PPP) can be classified into two, namely: a partnership project which idea came from the initiation of the government (solicited) and partnership project which idea came from the initiation of the business entities (unsolicited). To facilitate the implementation of the Public Private Partnership (PPP), the financing instruments that exist currently may be used to support the implementation of the Public Private Partnership (PPP). The importance of involving a third party other than investor and the government is related to the fulfillment of capital requirements and risks sharing in the event of loss. Although the rules clearly have been enacted, the infrastructure projects in Public Private Partnership (PPP) seem less attractive to investors. One of the causes is that the capital required by investors is too great with very high risk when investment in infrastructure is slow yielding. It is important to propose the scheme of sustainable financing which may allocate the PPPs’ risks proportionally. Until now, the government is too fixated with large cooperation projects with the private sectors, while the scheme offered is a Build-Operation-Transfer (BOT) scheme. This scheme is sometimes burden the investors, because the greatest risk is in the hands of investors. Regarding the financing of the Public Private Partnership (PPP), conventional financing such as a bank guarantee or sharia financing (‘kafalah’) can be carried out. Two such financing can be used in the Public Private Partnership (PPP), so it will increase the interest of investors to build infrastructure using Public Private Partnership (PPP). It is because such financing can overcome the difficulties of gaining large capital and also reduce the burden of risk borne by investors.

The public–private partnership (PPP) based model for the execution of infrastructure projects originated from Anglo-Saxon countries and was initially used in 1977 by the United Kingdom (U.K). Since then, its popularity has increased worldwide. Earlier studies by researchers and many other professional sectors and departments have introduced PPP contracts into different execution modes like Build, Operate, and Transfer (BOT); Build, Own, Operate, and Transfer (BOOT); and Build, Lease, and Transfer (BLT), etc. All definitions of PPP contracts are different but have a few common characteristics and risks. Previously, numerous pieces of literature were available on these common risks for various execution modes of PPP contracts. However, each PPP mode still has unique risks that must be identified to understand and successfully implement the PPP projects properly. This paper fills the gap mentioned above and aims to identify various commonly used PPP execution modes in infrastructure projects and their corresponding risks after placing the different PPP execution modes into four (04) different categories. Identified risks for the corresponding PPP categories were also divided into seven (07) stages of the PPP life cycle. Semi-structured interviews were conducted to gather information from thirty-four (34) PPP experts worldwide. Accordingly, interviews are transcribed and processed for thematic analysis in academic NVIVO software. These identified risks are further placed in the respective PPP category for the convenience and better understanding of the study’s outcome to the users and for the subsequent prioritization and allocation of these identified risks accordingly to the PPP parties during the finalization of the PPP execution mode.

The evolution of changes in the concept of public-private partnership is very relevant in today's world. The growth of global problems, such as financial crises, climate change, social imbalances and economic transformations, creates a need for new strategies and concepts of cooperation between different sectors of society. Public-private partnerships are a key mechanism to address these challenges, as they provide mechanisms for cooperation between public and private actors to achieve common goals. The purpose of the study is to substantiate the evolutionary changes of the concept of public-private partnership. Using bibliographic analysis and visualization of data from the Web of Science based on VOSviewer, ten research clusters were identified and analyzed, which reflect various topics and their interrelationships, contributing to the systematization of changes in the concept of public-private partnerships. Phases of the evolutionary transformation of the public-private partnership concept: Public-Private Partnership 1.0. Traditional Public-Private Partnership; Public-Private Partnership 2.0. People-first Public-Private Partnership; Public-Private Partnership 3.0. Climate-smart Public-Private Partnership; Public-Private Partnership 4.0. Sustainable public-private partnership for post-war reconstruction. It was determined that in the use of public-private partnership in industry, a change in the role of this sphere is observed. In the «Traditional Public-Private Partnership» industry has a key role in infrastructure construction, providing materials and advanced technologies for infrastructure projects; «People-first Public-Private Partnership» - ensuring quality medical care and improving the health care system; «Climate-smart public-private partnership» - reducing the impact of climate change on production through investments in environmentally friendly technologies and ensuring sustainability of food supplies; «Sustainable public-private partnership for post-war reconstruction» - post-war reconstruction, providing the necessary materials and resources for the construction and reconstruction of infrastructure. Also, during the COVID-19 pandemic, industry, particularly pharmaceuticals, is working with government and other sectors to develop new treatments and vaccines. These joint efforts help overcome crises and improve living conditions in affected areas. It was revealed that the concept of public-private partnership is insufficiently developed in Ukraine. «Traditional public-private partnership», despite 20 years of implementation, did not receive active implementation of infrastructure projects. «People-first Public-Private Partnership» is just beginning its development. It is noted that the «Sustainable public-private partnership for post-war reconstruction» is updated for post-war conditions, as it contributes to attracting international resources for economic and social recovery, but requires a systematic approach and adaptation to the specifics of the Ukrainian situation. The implementation of PPP in Ukraine requires systematic recommendations and consideration of international experience for effective use in the restoration and reconstruction of infrastructure and strategic objects.

Determinants of public-private-partnership performance: the case of Pakistan

Aim. The presented study aims to examine project initiatives and proposals for improving funding mechanisms for infrastructure projects based on public-private partnership in the Russian Federation.Tasks. The authors consider approaches and project initiatives of the G20 countries pertaining to the implementation of public-private partnership projects in the context of the adaptation of infrastructure projects to the Russian market (for the purpose of improving the quality and efficiency of the implementation of infrastructure projects in the Russian market).Methods. The methodological basis of this study includes works of Russian and foreign researchers in the field of public-private partnership and project financing. The authors use methods of scientific research (expert and comparative analysis, grouping and generalization) selected in accordance with the goals and objectives of the study as well as information publicly available on the official websites of the ROSINFRA platform and the Ministry of Economic Development of the Russian Federation.Results. Comparative analysis of foreign and national practices in the public-private partnership market makes it possible to identify a number of potential initiatives, including a new approach to the examination of infrastructure projects and proposals for attracting additional investment resources to the public-private partnership market. Adaptation of foreign competencies to the Russian public private partnership market will drive the transformation of the current PPP project model in Russia.Conclusions. Analysis of methods used by the G20 to assess and implement infrastructure projects based on public-private partnership makes it possible to formulate potential initiatives and proposals for improving approaches to the implementation of infrastructure projects based on public-private partnership in the Russian market and to determine the development vector for the national infrastructure project model.

Infrastructure projects require a great amount of capital investment resulting from their tremendous size, complexity, and risk. Due to the limitation of public finances, the private sector is invited to participate in infrastructure project development. The private sector can entirely or partially invest in an infrastructure project in the form of public-private partnership (PPP) scheme, which has been an attractive option for several developing countries, including Vietnam. Unfortunately, despite the PPP scheme will improve project efficiencies and attract capital investments of private investors, the success of PPP implementation is not guaranteed. This paper investigates the critical success factors (CSFs) of PPP infrastructure projects in Vietnam. Relevant data were collected through in-depth interviews with six PPP experts and questionnaire surveys with 150 interviewees, and then analyzed by the word cloud technique and the one-way analysis of variance (ANOVA) test. The CSFs were ranked based on the viewpoints of the public sector, the private sector, and the PPP consultants. The outcomes show that there was no significant difference in the perceptions of all three parties concerning the success factors for PPP infrastructure projects in Vietnam. The top five critical success factors are (1) timely land acquisition and appropriate compensation, (2) financial capacity of the private sector, (3) effective project management, (4) favorable and complete legal framework and regulations, and (5) financial feasibility and attraction. Recognizing the CSFs is indispensable to ensure the success of PPP infrastructure project implementation.

Public Private Partnerships (PPPs) are increasingly being utilised internationally as new avenues for providing goods and services to the public with over 1,100 projects worth US$ 450 billion built around the globe between 1985 and 2008 (Siemiatycki, 2010). However, managing PPPs, particularly in the implementation phase, is both theoretically and practically complex with success largely determined by how well partnerships are managed (Grossman, 2010). Yet, PPP scholars (e.g. Bach & Whitehill, 2008; Jones & Noble, 2008) have noted that little is known about managing PPP arrangements and have called for further research to understand the ‘black box’ of PPPs (Weihe, 2008). The current research is significant in elucidating this ‘black box’ and in analysing management challenges that partnerships experience in the implementation phase. Inter-organisational relationships (IORs) and inter-organisational culture (IOC) have been identified as closely related to the PPP research and are utilised within this research to provide important insights into understanding the management of PPPs in the implementation phase. This research examines PPPs in the Jordanian context; one of the newer but most common users of PPPs in the Middle Eastern region, where PPPs are of economic strategic importance and entail significant investment risk (El-Khatib, 2008). Specifically, the current research explores ‘How effectively managed is the implementation of PPP infrastructure projects in Jordan?’ This question is explored through perceptions of PPP managers within two Jordanian case study organisations. The intention is to critically analyse how PPPs should be managed in order to contribute to the development of what might be regarded as universal theory of PPPs that can be tested, applied and generalised to other contexts. To achieve the objectives of this research, an exploratory, ontologically-oriented, qualitative research design was utilised. Data were collected from 21 in-depth, semi-structured interviews with selected informants at the senior managerial level representing different partnering organisations. Content thematic analysis was used to analyse interview data and documentary data.

No AccessMar 2020Integrating PIM and PPP in a Unified FrameworkAuthors/Editors: Jay-Hyung Kim, Jonas Arp Fallov, Simon GroomJay-Hyung KimSearch for more papers by this author, Jonas Arp FallovSearch for more papers by this author, Simon GroomSearch for more papers by this authorhttps://doi.org/10.1596/978-1-4648-1529-4_ch10AboutView ChaptersFull TextPDF (0.7 MB) ToolsAdd to favoritesDownload CitationsTrack Citations ShareFacebookTwitterLinked In Abstract: Provides guidance on the harmonization and integration of public investment management (PIM) and public-private partnerships (PPPs), presenting the rationale for why this integration matters and discussing “must-have” elements for PIM-PPP integration. The last two decades have seen growing global interest in PIM and PPPs. Public investment projects, implemented through a PPP or through more conventional means, should aim to support the creation of viable economic infrastructure, such as roads, airports, and railways, or to provide social infrastructure and public services, such as hospitals and schools. Both implementation modalities should stem from the same basic government demands or policy objectives. The World Bank has developed a PIM-for-PPP (PIM4PPP) diagnostic tool to help governments establish a unified approach for public investment that encompasses traditional project financing and PPPs, providing an analytical framework for assessing the whole investment cycle, from ex ante appraisal to ex post review, under a unified system for effectively managing traditional public investment and PPP. ReferencesBiletska, N, J H Kim, M Darcy, M P Dunne, and I Zapatrina. 2016. Public-Private Partnerships in the Context of Public Investment Management in Ukraine: An Assessment. 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Google ScholarIrwin, T 2007. Government Guarantees: Allocating and Valuing Risk in Privately Financed Infrastructure Projects. Directions in Development—Infrastructure. Washington, DC: World Bank. LinkGoogle ScholarKim, J H, N Biletska, and M Darcy. 2015. “Public Investment Management for Public Private Partnership: Analytical Framework and Assessment Tool.” Unpublished paper, World Bank, Washington, DC. Google ScholarKim, J H, J Kim, S Shin, and S-Y Lee. 2011. Public-Private Partnership Infrastructure Projects: Case Studies from the Republic of Korea, Volume 1: Institutional Arrangements and Performance. Manila: Asian Development Bank. Google ScholarMinistry of Finance and Economic Development, Zimbabwe. 2017. “The Public Investment Management Guidelines.” Secretary to the Treasury, Harare. 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LinkGoogle ScholarWorld Bank. 2018. “Jordan 2018 Public Investment Management: Public-Private Partnership Governance Framework.” World Bank, Washington, DC. Google Scholar Previous chapterNext chapter FiguresreferencesRecommendeddetails View Published: February 2020ISBN: 978-1-4648-1529-4 Copyright & Permissions Related CountriesCyprusJamaicaKorea, Republic ofUnited KingdomZimbabweRelated TopicsFinance and Financial Sector DevelopmentInfrastructure Economics and FinanceMacroeconomics and Economic GrowthPublic Sector Development KeywordsCASE STUDYPUBLIC INVESTMENTINFRASTRUCTURE INVESTMENTPUBLIC SECTOR REFORMGOOD GOVERNANCENATIONAL DEVELOPMENT PLANSFINANCIAL DEVELOPMENTFINANCIAL MANAGEMENTHARMONIZATION ISSUESPUBLIC-PRIVATE PARTNERSHIPSINFRASTRUCTURE MAINTENANCEPUBLIC SPENDINGPREAPPRAISAL PDF DownloadLoading ...

PurposeThe purpose of this paper is to examine the risk perception of project sponsors in financing of public–private partnership (PPP) infrastructure projects in India.Design/methodology/approachThe methodology used is survey questionnaire that seeks the perception of risk managers in PPP projects. Rating and relative ranking of risk at various phases of PPP project have been analyzed and supplemented by unstructured interviews.FindingsThis paper shows that the perception of project sponsors for various levels of project risk categories differ significantly in PPP infrastructure projects. The practices of assessing risk and handling differ among the financing institutions. The ranking of risks shows a disagreement among respondents for relative importance. The project financiers that include major banks and financial institutions funding for the PPP infrastructure projects perceive risks differently, and their disagreement on the relative importance of risks may create a sub-optimality in risk management, and the essence of project sponsorship may be lost.Research limitations/implicationsThis paper examines the perceptions of the various risks involved in PPP infrastructure project financing. The authors emphasize on the infrastructure projects in the transportation and energy sector that are undertaken in the PPPs. This research can further be extended to the other infrastructure sectors such as roads, shipping and communication.Practical implicationsExperiences reveal that risk perception profoundly influence the implementation of infrastructure projects involving PPPs. To ensure smooth implementation and success of PPP infrastructure projects, the project sponsors must align, synchronize and develop consensus on the various funding and non-funding risks into the project curriculum.Social implicationsThe PPP infrastructure projects carry huge investment and are of strategic importance to the nation and society. In order that the provision of infrastructure which can be most economically and efficiently delivered through PPPs, the risk concordance assumes crucial importance.Originality/valueThe authors believe that this research may provide new direction to the visible and invisible misbalances in risk postures of project partners, which has been a cause of concern to the government and policymakers in India in the recent times.

Public private partnership (PPP) has over the years proven to be a good procurement method for infrastructure projects. This partnership combines the efficiency, expertise, and innovation of the private sector as well as appropriate risk allocation. PPP provides an alternate avenue for capital needed for major engineering projects. The objectives of this paper are to highlight the effectiveness of implementing PPP by looking at past experiences in infrastructure projects, to investigate the conditions under which PPP is appropriate, and to identify the benefits, success, and difficulties of PPP. The results of this paper show that most experts in the infrastructure industry are aware of the effectiveness of PPP but are unable to determine how to maximize its success. This paper further identifies the various factors needed for a successful PPP, such as risk allocation and a good partnering plan for a successful execution of the project.

The rapidly increasing demand and the inefficacy of financing transportation infrastructure project investments have contributed to various challenges for Vietnam in recent decades. Since the country’s budget is inadequate for investing in all necessary infrastructure projects, the Vietnam government has been inviting other economic sectors, especially the private sector, to participate in infrastructure development. The cooperation between the government agencies and the private entities, called Public-Private Partnership (PPP), must encounter various challenges leading to difficulties in attracting private investors. A main reason is that private investors must deal with critical risks concerning PPP investment environment. It is a challenging task for the government to optimally manage such risks to enhance the attractiveness of PPP projects for private investors. This paper examines the critical risk factors that influence the private sector’s investment decisions on PPP transportation projects in Vietnam. Risk factors inherent in typical PPP projects were compiled by comprehensive literature review. To reflect unique characteristics of PPP projects in Vietnam, the compiled risk factors were reviewed by a group of PPP experts from both the public and private sectors in Vietnam through in-depth interviews and questionnaire surveys. In addition, ten PPP project case studies in Vietnam were analyzed to derive the risk profile of PPP transportation projects of the nation. These risk factors were quantitatively assessed based on their probabilities and impact levels. We found that the critical risk factors of PPP infrastructure projects in Vietnam are acquisition/compensation problems, approvals and permits, inadequate feasibility studies, finance market issues, subjective evaluation methods, and change in laws and regulations. By performing factor analysis, these critical risk factors were grouped into four categories: (1) bidding process, (2) finance issues, (3) laws and regulations, and (4) project evaluation issues. These critical risk factors represent the obstacles that repel private investors from PPP transportation projects in Vietnam. Thus, the Vietnam government agencies should meticulously address these issues to attract both domestic and foreign private investors in PPP projects.