Selecting the Best Public–Private Partnership Contract by Using the Fuzzy Method

Abstract

Universally, many countries have been utilizing Public–Private Partnerships (PPPs) for exploiting infrastructure developments. Transactions in PPP, in such situations, are established on an association of complicated legitimate contracts. Conversely, in such transactions, a PPP contract is usually drawn up between the public authority (the “Contracting Authority”) and private company (the “Private Partner”) in the outline of a franchise contract or similar document. When drawing up and confirming PPP transactions, extensive time and investments are entailed due to the intricacy, difficulty, as well as the reality that the attributes of the infrastructure developments are often deeply consulted as to be reflected in such contracts. As a result, observers have questioned whether time and cost reduction in such procedures is viable, in which the provisions established in the franchise arrangements and other PPP indentures between the public and private sectors are systematized. Various regions have attempted to establish PPP indentures that are completely systematized in numerous types of infrastructure developments, such as road and railway networks, harbors or power generators. Thus far, for PPP transactions, no attempt has been made to develop a globally conventional linguistic on an international basis. Public–Private Partnership contracts can be categorized into various types, which are often known as PPP’s or P3’s. In this paper, six types of contracts will be discussed, namely Build-Operate-Transfer (BOT), Build-Own-Operate (BOO), Build-Own-Operate-Transfer (BOOT), Design-Build (D/B), Design-Build-Finance-Operate (DBFO), O&M (Operation and Maintenance), and their effectiveness will be ranked according to the selected parameters. This paper is aimed at establishing a fuzzy-based multicriteria decision-making model for determining which of the PPP contracts is the most suited for infrastructure projects.