Public-private Partnership Projects Research Articles

Methodological and analytical basis of construction enterprises in the cycle of public-private partnership projects

Public-private partnership (PPP) is a strategically important management tool that allows the state and the private sector to jointly implement projects in various fields, such as infrastructure, health care, education, and others, to promote economic development. However, the successful implementation of PPP requires a clear understanding of the basic definitions and concepts underlying it. This research work is devoted to working out the content of basic definitions in the context of the establishment and development of PPPs. It examines the main terms, such as "public-private partnership", "public-private partnership", "infrastructure projects" and others, including their definition, essence and role in the formation of an effective model of cooperation between the state and the private sector. The conducted research is based on the analysis of scientific literature, legal acts and practical experience of PPP implementation in different countries of the world. It is aimed at revealing the essence and meaning of each of the definitions, highlighting the key aspects that affect their interpretation and use in practice. In addition, the work draws attention to the evolution of concepts and terms in the context of the establishment and development of PPPs over time. Taking into account the dynamics of the global market and changing economic conditions, the work analyzes the impact of new factors on the understanding and use of basic definitions in PPP practice.The main results of the study provide a clear and concrete understanding of the basic definitions of PPPs, which will contribute to improving the quality of planning, implementation and management of PPP projects. In addition, they can become the basis for further research in this area, including the development of new theoretical models and methods for assessing the effectiveness of PPPs.All this indicates the relevance of the topic and the importance of further research in order to improve PPP practice and promote sustainable economic development .

DEVELOPMENT OF PUBLIC-PRIVATE PARTNERSHIP IN THE CHUVASH REPUBLIC

The purpose of this study is to analyze the state of public-private partnerships in the Chuvash Republic, identify the trends of their formation and propose the ways of their development. Materials and methods. The paper made use of the ratings, monthly Russia's public-private partnership market review digest, investment sites, which provide up-to-date information, an overview of public-private partnership projects in the Chuvash Republic. The main research methods were analysis and comparison. The authors made the analysis of the dynamics of the implementation of public-private partnerships in the Russian Federation, SWOT analysis of the development of public-private partnerships in the Chuvash Republic and the comparison analysis of investment sites of different regions. Research results. As a result of the detailed analysis of regional investment portals and ratings, the author found that the investment website of the Chuvash Republic, which provides examples of successful practices of public-private partnerships, is not informative enough. The analysis of the public-private partnership reveals that the Chuvash Republic ranks the last in the Volga Federal District in terms of the public-private partnership development rating, which implies there are problems in this area. There is a need for identifying the most interesting and suitable practices of implementing public-private partnerships to be used in the Chuvash Republic. Thus, as a result of the analysis of the public-private partnership development in the Chuvash Republic, the author proposes new ways to effectively develop public-private partnerships. They will help to improve the position in the public-private partnership ranking and attract investment to the Chuvash Republic. Conclusions. Thus, the article substantiates that the investment site of the Kaluga region is more complete and the most advanced, and as the first best experience, it is quite applicable when improving the investment site of the Chuvash Republic. Using the example of the experience of the Republic of Bashkortostan, the author proposes to introduce a new position at the Center for Public-Private Partnership in the Chuvash Republic – a business sheriff.

Development of motivational mechanisms for risk transfer in public-private partnership projects

Subject. The article is devoted to the relations that arise between the State (public) partner and the private partner when distributing risks in public-private partnership (PPP) projects. Objectives. The study aims to establish features of motivation mechanisms designed to encourage private investors to accept the risks arising when making a PPP agreement. Methods. The basic research methodology is to determine the sensitivity of a private investor to certain types of risks based on systematization of motivation opportunities. The study employs content analysis and statistical data. Results. The paper identifies risk groups for which motivational incentives are applicable, and establishes standard motivational mechanisms. It notes that the formation of motivational mechanisms should consider key trends in the influence of the State on private investors. The areas that significantly influence the motivation of a private investor include, in particular, eliminating economic inequality of economic agents, opportunity to access innovation, solving social and environmental problems, creating a stable business environment and necessary infrastructure. Conclusions. Economic factors represent a key motivational element in risk allocation decisions, but they are not always completely dominant. Only a combination of individual and institutional measures can create an attractive environment for private investors considering the investment of their own capital in PPP projects. The findings can be used when concluding PPP project agreements at all levels, in accordance with the legislation on PPP, and ensuring the implementation of the proposed algorithm for the motivational mechanism formation.

Status and Development of Agricultural Public-Private Partnership Program Implementation in China

<p>As the initiator of the Belt and Road Initiative, the Chinese Government’s goal in agriculture is to promote the sustainable development of agriculture throughout China and the world. One of the feasible ways to realize this goal is to adopt the Public-Private Partnership (PPP) model. This study aims to analyze the current status of agricultural PPP projects in China and their impacts. This study utilized the Ministry of Finance database to collect 2014 to 2022 data on agricultural PPP projects in China. The collected data were organized and analyzed to analyze the current situation and return mechanism of Chinese agricultural PPP projects. The results show that China’s agricultural PPP projects are less attractive than other sectors, government and social-private sector cooperation is less sustainable, and laws and regulations and risk assessment are not well developed. Therefore, this study proposes to promote the development of agricultural PPP projects by standardizing the law, improving the return mechanism, and strengthening the risk assessment. Thus, it further promotes the sustainable development of agriculture and plays a certain positive role.</p>

Особенности использования кластерного подхода при организации государственно-частного партнерства в сфере туризма

The study of the features of using the cluster approach in organizing public-private partnerships in the field of tourism is highly relevant in the context of the continued sanctions regime against Russia by the United States and the European Union. This is due, on the one hand, to the multiple growth of domestic tourism in many regions of Russia, and on the other, to high geopolitical risks and limited financial resources of Russian business. The article describes the dynamics of the development of public-private partnerships and its organizational features in the Russian Federation. In particular, the absolute priority of the share of concession agreements in the overall structure of public-private partnership projects in 2022 is shown; the structural differences between the initiatives of public-private partnership projects in Europe and the Russian Federation in 2020-2022 are identified, as well as the national characteristics of public-private partnerships in relation to the tourism complex, the organization of which is still a poorly developed method of improving national tourism. A significant difference between a domestic organization and a foreign one is that in Russia tourism is considered as a separate sector, while in Europe public-private partnership projects indirectly influence the improvement of tourism in the regions through the development of transport and social infrastructures. Whereas in Russia, in addition to projects of indirect importance, much attention is paid to potentially useful objects for increasing direct endogenous tourism indicators, such as the number of tourist arrivals, the number of foreign arrivals, increasing the share of tourism in GDP, passenger traffic, etc. It is concluded that a characteristic feature of the development of the tourism complex in the public-private partnership (PPP) format can be considered the use of the cluster approach as the main one. This allowed the authors to reveal a set of advantages of PPP in tourism; formulate the characteristics of a tourism cluster formed through the association of representatives of government agencies and private business; propose a scheme for the effectiveness of PPP design in tourism using a cluster approach.

Configuration analysis of asymmetric trust between infrastructure PPP project participants

PurposeTrust is the glue that holds cooperative relationships together and often exists in an asymmetric manner. The purpose of this study is to explore how to mitigate the issue of losses or increased transaction costs caused by opportunistic behavior in a soft environment where trust asymmetry is quite common and difficult to avoid.Design/methodology/approachThis study focuses on examining asymmetric trust between the government and the private sector in public-private partnership (PPP) projects. Drawing upon both project realities and relevant literature, the primary conditional variables influencing asymmetric trust are identified. These variables encompass power perception asymmetry, information asymmetry, interaction behavior, risk perception differences and government-side control. Subsequently, through the use of a survey questionnaire, binary-matched data from both the government and the private sector are collected. The study employs fuzzy-set qualitative comparative analysis (fsQCA) to conduct a configurational analysis, aiming to investigate the causal pathways that trigger asymmetric trust.FindingsNo single conditional variable is a necessary condition for the emergence of trust asymmetry. The pathways leading to a high degree of trust asymmetry can be categorized into two types: those dominated by power perception and those involving a combination of multiple factors. Differences in power perception play a crucial role in the occurrence of high trust asymmetry, yet the influence of other conditional variables in triggering trust asymmetry should not be overlooked.Originality/valueThe findings can contribute to advancing the study of trust relationships in the field of Chinese PPP projects. Furthermore, they hold practical value in facilitating the enhancement of trust relationships between the government and the private sector.

Modeling and Understanding Dispute Causation in the US Public–Private Partnership Projects

Modeling and Understanding Dispute Causation in the US Public–Private Partnership Projects

Identifying Critical Success Factors of Public Private Partnership Projects in Türkiye

Public private partnerships (PPPs) have become increasingly common as a result of states' shifting roles in infrastructure services from service providers and operators to policymakers and regulators. PPPs have been established as a prominent technique of public service procurement in both developed and developing countries. PPPs give the parties the opportunity to split the costs and risks of providing a public service or building a public infrastructure. Successful project management is crucial, especially in light of PPP projects' size and complexity. This study investigates the critical success factors (CSFs) of PPP investments in developing countries. In this regard, 23 CSFs were selected based on a thorough literature review, and a questionnaire survey was run to examine the impact of those factors on PPP performance. The information is gathered from 82 different companies in Türkiye that represent both the public and private sectors. The statistical analysis results show that favorable legal framework, detailed and clear project identification, and extensive cost-benefit assessment are the most significant drivers of success. Additionally, factor analysis is used on the data to investigate and identify underlying correlations between the factors, as well as to categorize them into fewer, more focused, and more thorough factors. The results of factor analysis suggest five dimensions; namely project finance, project management, operational factors, procurement, and organizational factors. The study's findings are anticipated to benefit both the public sector in its focus on legal concerns to permit better operation and the contractors in its examination of their capacity to manage big projects more effectively.

TAX INCENTIVES AS A TOOL OF DEVELOPMENT OF PPP PROJECTS FOR EMERGENCY MANAGEMENT: EXPERIENCE OF PRC REGIONS

The purpose of the research. The article discusses the public-private partnership (PPP) projects as an important tool for attracting private sector resources to enhance the efficiency and quality of emergency response. It analyzes the extent to which tax incentives influence the financial decisions of corporations and investment returns in the context of regions in China. The purpose of the research is to identify the role of tax benefits in stimulating the use of PPP projects for managing emergencies. It presents specific cases where tax incentives were utilized to recover participating in PPP projects enterprises during the pandemic. Results. The research revealed that the provision of tax incentives has had a positive impact on PPP projects. This is achieved through the reduction of financial burdens on enterprises, lowering costs for PPP projects implementation, and increasing investment returns. These measures provide critical support for the successful implementation of PPP projects and contribute to sustainable national economic development. PRC’s experience demonstrated that even during social crises such as the COVID-19 pandemic, tax incentives effectively promote private sector participation in infrastructure construction and the provision of public services to harmonize the economic and social goals in public policy.

Temporal analysis of project completion-a comparative study between Public-Private Partnership (PPP) and private sector in the energy infrastructure

The present study conducted to understand the timeline dynamics associated with project completion in the context of Public-Private Partnership (PPP) and the Private Sector. It is commonly recognized that PPP projects typically exhibit long durations compared to similar projects undertaken by the private sector. Semi structured questionnaire survey was conducted to collect data from the Industry experts on PPP and Private Sector projects. Subsequent to careful data cleansing, the structured dataset underwent for statistical analyses. Our findings indicate that building PPP projects takes significantly more time compared to private sector projects. The results suggest to identify ways to speed up project delivery. It is found that using Blockchain Technology, especially Corda, can help track project progress easily, closing gaps and making projects faster.

Are PPP projects poor fundability in China：Based on ensemble learning

The Public-Private Partnerships (PPP) financability is influenced by both internal and external factors of the project. Given the myriad of factors that influence the participation of social capital in PPP projects, in this study, we examine 14,038 PPP projects from the China Public‒Private Partnership Centre (CPPPC) database. We aim to construct an ensemble learning-based prediction model for the financability of PPP project by selecting 61 feature variables across four dimensions, namely, project characteristics, local government, the market environment, and macroeconomics. The experimental results demonstrate that the dragonfly algorithm effectively improves model prediction accuracy through the reduction of feature dimensionality. From a feature combination perspective, the combinations related to the project itself, local government, and macroeconomic factors exhibit superior predictive performance than other combinations. Among the relevant factors, the project's intrinsic characteristics exert the most significant impact on social capital participation in PPPs, followed by local government factors. Notably, the inclusion of market environment variables tends to decrease the level of model accuracy, except when considering the project's intrinsic characteristics in isolation. Thus, a dynamic approach is recommended to capturing instantaneous variables such as the market environment is recommended for enhancing model performance. Additionally, social capital should rely on an assessment of the financial capacity of local governments to ensure effective PPP outcomes.

The effects of contractual and relational governance on public‐private partnership sustainability

AbstractThe study investigates how contractual and relational governance influence partner behaviors and promote sustainability performance of infrastructure public‐private partnerships (PPPs). Survey data from 217 Chinese PPP projects were analyzed using partial least squares structural equation modeling. This study found that both contractual and relational governance have positive effects on PPP sustainability, with contractual governance having a stronger impact. Contractual governance complements relational governance in promoting cooperative behavior, but relational governance does not amplify the effect of contractual governance on opportunistic behavior. The findings highlight the role of contracts in curbing opportunism and promoting collaboration via multiple functions of control, coordination, and adaption, while also revealing the limitations of relational approaches in the context of government‐business relationships and performance ambiguity. This study contributes to the PPP governance literature by uncovering the individual and interactive effects of contractual and relational governance on the economic, social, and environmental aspects of PPP sustainability.

Problems and prospects of development of public-private partnership in the Republic of Kazakhstan: Political analysis

Relevance. Public-private partnership (PPP) is considered as a priority in Kazakhstan's state policy for achieving strategic plans, fostering political stability, and boosting the economy by attracting private investment in key sectors. Thus, studying the PPP issues and prospects is vital, necessitating a comprehensive economic perspective and integration with other societal spheres of public life. Purpose. The study aims to explore the political aspect of PPP development in Kazakhstan and seeks to assess the extent of influence exerted by various factors on the PPP mechanism. Additionally, the study intends to identify measures for enhancing the PPP framework, with particular attention to the relative importance of factors impacting its progress. Methodology. The study's empirical basis involved a PEST analysis of PPP issues, utilizing expert questionnaires from 5 political scientists, 5 economists, 5 sociologists, and 5 technology specialists. An expert survey with scaling estimates was conducted, followed by an analysis of these assessments. Results. The results of the study reveal ways to enhance the PPP mechanism by examining the specific impacts of political, economic, social, and technological factors. The study is theoretically grounded in neocorporatism, which advocates for the systematic involvement of interest groups in shaping state policies that connect government and business entities. The hypothesis was tested by evaluating the influence of these factors on PPP development, identifying key challenges, and outlining future prospects for PPPs in Kazakhstan. Conclusions. Based on the findings of the PEST analysis, it is evident that updating the legislative framework to align with current requirements is crucial for enhancing the efficiency of PPP initiatives. Improving PPP project quality necessitates prioritizing projects addressing fundamental societal needs and critical issues. Keywords: strategic partnership; business; state; neo-corporatism; information technology; democratic society

STRUCTURAL EQUATION MODEL-BASED PERFORMANCE MEASUREMENT SYSTEM FOR TRANSFERRING PPP WATER PROJECTS: A CHINA PERSPECTIVE

A series of performance measurement need to be carried out throughout the project life cycle to ensure the successful transfer of public-private partnership (PPP) assets and meet stakeholder needs. More and more water projects are stepping into the transfer phase, but less studies carry out in-depth and systematic discussion on the performance measurement of PPP water projects at the transfer phase. Hence, to fill this gap, this research establishes a new performance measurement system (PMS) for evaluating the performance of the PPP projects stepping into the transfer phase based on the key performance indicators (KPIs). Through case study, expert interview and questionnaire, this paper formulates the logical basis behind PPP water projects at the transfer phase and subsequently constructs the transfer performance measurement system (TPMS) of these projects. Then, it conducts a confirmatory analysis of the impact relationship between the indicators based on structural equation modeling (SEM). Findings of expert interview and questionnaire indicate that there are 7 primary and 26 secondary indicators, and the model has a good fit. The TPMS will provide governments, operators and other stakeholders with a comprehensive and complete understanding as to indicators required of an effective performance measurement of PPP water projects.

Private and public interests as factors in the effectiveness of public-private partnership

Cooperation carried out within the framework of public-private partnerships is characterized by high risks of dishonest behavior of the parties to the agreement. The circumstances that encourage dishonest behavior of the state and private partners are considered. The stages of implementation of public-private partnership projects have been established, at which the risk of dishonest behavior is the highest. Recommendations aimed at minimizing such risks are proposed. It is concluded that it is necessary to increase the transparency of ongoing procedures, expand the parameters taken into account and controlled when making decisions within the framework of public-private partnerships, the importance of detailed documentation of the facts of economic life and attract public attention to public-private partnerships.

Risk assessment and classification prediction for water environment treatment PPP projects.

Water treatment public-private partnership (PPP) projects are pivotal for sustainable water management but are often challenged by complex risk factors. Efficient risk management in these projects is crucial, yet traditional methodologies often fall short of addressing the dynamic and intricate nature of these risks. Addressing this gap, this comprehensive study introduces an advanced risk classification prediction model tailored for water treatment PPP projects, aimed at enhancing risk management capabilities. The proposed model encompasses an intricate evaluation of crucial risk areas: the natural and ecological environments, socio-economic factors, and engineering entities. It delves into the complex relationships between these risk elements and the overall risk profile of projects. Grounded in a sophisticated ensemble learning framework employing stacking, our model is further refined through a weighted voting mechanism, significantly elevating its predictive accuracy. Rigorous validation using data from the Jiujiang City water environment system project Phase I confirms the model's superiority over standard machine learning models. The development of this model marks a significant stride in risk classification for water treatment PPP projects, offering a powerful tool for enhancing risk management practices. Beyond accurately predicting project risks, this model also aids in developing effective government risk management strategies.

Investment analysis of the private firm under different financial arrangements in infrastructure projects.

This study investigates the impact of various financial arrangements on the investment behavior of the private firm in PPP (Public-Private Partnership) projects. The results manifest that: first, the private firm will invest in the project earlier under long-term debt financing than under short-term debt financing or all equity financing; second, the investment boundary of the private sector decreasing with the probability of obtaining long-term debt financing under short-term debt financing, while increasing with the probability of obtaining long-term debt financing under long-term debt financing; third, the optimal debt level under short-term debt financing displays a U-shaped relationship with the refinancing risk probability; fourth, under short-term debt financing, the difference in the optimal capital structure between projects with different volatility of cash flow is larger when the refinancing risk probability is lower; and fifth, the private firm may exit the project earlier under short-term debt financing than under long-term debt financing. These results can help us to understand the investment behavior of the private firm under different financial arrangements.

DETERMINING CONCESSIONARY ITEMS FOR “AVAILABILITY PAYMENT ONLY” PPP PROJECTS: A HOLISTIC FRAMEWORK INTEGRATING VALUE-FOR-MONEY AND SOCIAL VALUES

Public-private partnerships (PPPs) have been widely applied in infrastructure development around the world. However, reasonable concessionary items are critical to compromise interest conflicts between government agencies and sponsors to ensure project success. A broad literature review centering on PPP transaction structuring revealed two significant research gaps: (1) a lack of attention to the ‘availability payment only’ (APO) funding method and (2) negligence of the public side’s perspective in determining concessionary items. The research objective was to develop a methodological framework for determining concessionary items in APO PPP projects while considering the interests of the public side. This study proposed a value-for-money (VFM) and social values integrated framework which accommodates discounted cash flow (DCF) analysis, bargaining game modeling, and multi-objectives decision-making (MODM). This framework enables a decision-making process based on both an indifferent feasible interval of concessionary items under a discount rate agreed upon by both parties and an optimal set of concessionary items. Additionally, results of a sensitivity analysis indicated that project construction profit can significantly affect feasible and optimal concession items, and the optimal concession period is less sensitive to changes in risk allocation. The application of proposed model indicated that this paper successfully provides a methodology for determining a feasible interval and an optimal concession items group tailored to APO PPP projects. This study paves the way towards a platform for the public and private partners to jointly and quickly come up with sound PPP concessional items in light of the win-win principle, particularly under the APO funding mechanism.

Public-private partnership effect on the company technology innovation-empirical and theory: evidence from China

ABSTRACT As China’s economy enters the ‘new normal’ operational stage, the widespread adoption of the Public-Private Partnership (PPP) model has engendered substantial transformations in infrastructure investment and financing practices, progressively moving towards standardization. This study employs indicators such as Research and Development (R&D) investments and the number of patents held by publicly listed companies to assess their innovation performance. Employing a Differences-in-Differences (DID) empirical methodology, and utilizing the Propensity Score Matching (PSM) trend-matching technique to establish experimental and control groups, we empirically investigate whether participation in PPP projects exerts an influence on the innovation investments of listed companies and whether it results in a detrimental crowding-out effect. The empirical findings of our analysis demonstrate that engagement in PPP projects leads to a reduction in the innovation investments made by listed companies, thereby exerting a significant impact. Additionally, the magnitude of the crowding-out effect on innovation is positively correlated with the number of PPP projects, though the effect is not particularly pronounced or statistically significant. This study further conducts an in-depth comparative analysis of the innovation levels observed within state-owned enterprises and private firms. It subsequently proposes targeted solutions aimed at enhancing the innovation capacities of both state-owned and private enterprises.

EFFICIENCY OF PUBLIC-PRIVATE PARTNERSHIP IN INFRASTRUCTURE DEVELOPMENT: ANALYSIS AND PROSPECTS

In 2022, the magnitude of investments in Public-Private Partnerships (PPP) within the infrastructure sector demonstrated a gradual resurgence. Beyond the well-established practice of attracting significant PPP investments in developed nations, there has been a notable increase in the engagement of middle-income countries in the utilization of public-private collaborative mechanisms for the advancement of their infrastructure. Among the sectors, transportation, and communications have consistently maintained a prominent position in terms of both investment influx and the quantity of successfully executed infrastructure projects on a global scale. Quantitative performance indicators within the sphere of PPP projects, encompassing metrics such as the count, monetary volume, and the proportion of different agreement types, manifest encouraging trends in the execution of infrastructure PPP initiatives. Conversely, the qualitative outcomes of this investigation reveal a spectrum of issues that are intrinsically linked to CSFs. These CSFs represent the principal benchmarks that exert a direct influence on the efficiency of PPP projects concerning their established objectives, processes, and management framework. The research undertaken by the authors has successfully identified a range of disparities in the challenges faced during the implementation of PPP projects across diverse nations, notwithstanding the similarity in the underlying mechanisms of cooperation.