Public-Private Partnerships : Promise and Hype
This paper provides perspectives on patterns of public-private partnerships in infrastructure across time and space. Public-private partnerships are a new term for old concepts. Much infrastructure started under private auspices. Then many governm...
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| Language: | English en_US |
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World Bank, Washington, DC
2015
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| Online Access: | http://documents.worldbank.org/curated/en/2015/06/24711409/public-private-partnerships-promise-hype http://hdl.handle.net/10986/22223 |
| Summary: | This paper provides perspectives on
patterns of public-private partnerships in infrastructure
across time and space. Public-private partnerships are a new
term for old concepts. Much infrastructure started under
private auspices. Then many governments nationalized the
ventures. Governments often push infrastructure providers to
keep prices low. In emerging markets, the price of water
covers maybe 30 percent of costs on average, that of
electricity some 80 percent of costs. This renders public
infrastructure ventures dependent on subsidies. When
governments run into fiscal troubles, they often look again
for public-private partnerships, and price increases. As a
result, public-private partnerships keep making a comeback
in most countries, but are not always loved. Waves of
interest in public-private partnerships sweep different
countries at different times. Overall, in emerging markets
today, public-private partnerships account for some 20
percent of infrastructure investments, with wide variations
across countries and from year to year. There is no “killer”
rationale for public-private partnerships. They can help
raise financing when governments face borrowing constraints.
They can be more efficient when sound incentives are
applied. Existing evaluations suggest public-private
partnerships tend to perform often a bit better than public
provision. Yet, well-run governments can do as well.
Public-private partnerships provide mechanisms to improve
the governance of infrastructure ventures where governments
are flawed. Once the fiscal troubles are over, the politics
of pricing assert themselves again. Tight pricing erodes the
profitability of public-private partnerships and the wheel
of privatization and nationalization keeps turning, as it
has since modern infrastructure services were invented. |
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