The world has seen many public-private partnerships (PPPs) for infrastructure projects and other types of collaborations, but there is widespread confusion as to what constitute a good PPP. Individual governments and consultants offer advice, but it sometimes still seems like a cacophony of voices. I looked into the guidelines, recommendations and tools from international organizations such as ASEAN, OECD, the World Bank and others have produced. In my research I found that international organizations converge on many of the issues and content of the guidelines for PPPs, even though they may recommend different specific tools to help governments go further with PPPs.
The World Bank recently launched its ambitious PPP Knowledge Lab. OECD also recently convened a meeting in Paris with PPP senior officials and experts (see: OECD Senior PPP officials meeting . My research has shown that international organizations use roughly the same categories and conceptions of stages for what is needed to establish effective PPPs. A broad policy consensus seems to have emerged in international organizations on recommendations for good public governance of PPPs. The content of the international organizations’ PPP policies focuses on.
- a robust institutional framework
- the selection of projects grounded on value-for-money judgments and well prepared economic analysis
- management and leadership skills and competences needed for PPP projects
- transparent procurement and budgetary procedures, and
- creating opportunities for policy learning of experiences with PPPs.
Policy learning is enhanced by establishing “prestigious forums” in the OECD, World Bank and other international organizations,, processing and reporting on quantitative data, and transforming the knowledge into guidelines and other resources for organizations to use.
The OECD is a good example here. OECD has a report with a a list of 12 recommendations grouped under three themes: OECD Principles for PPPs “1) Establish a clear, predictable and legitimate institutional framework supported by competent and well-resourced authorities. 2) Ground the selection of public-private partnerships in value for money. 3) Use the budgetary process transparently to minimize fiscal risks and ensure the integrity of the process”. The ASEAN countries have adopted most of the OECD insights in their list of 14 recommendations. The two important additional recommendations in the ASEAN framework concern a call to “prudently assess the potential for cost recovery, regardless of the degree of private participation” and a “mechanism for cross jurisdictional co-operation, also at the regional level”. There are other recommendations and best practices recommended from think tanks, research centers and scholars. Brookings has a report on PPPs with ample recommendations for PPP projects. Lawrence Martin and colleagues recently listed 10 internationally recommended best practice advice for transportation PPPs. These included advice on the size and complexity of PPP projects and the need for dedicated PPP units.
PPPs continue to important in Europe and elsewhere. The European PPP Expertise Center recently reported that there were 49 PPP deals in Europe in 2015 with a combined value of EUR 15,6 billion. 15 projects were in education, 12 projects in transport and 10 projects in healthcare.
Now that we have new and codified knowledge that exist in the PPP guidelines in international organizations, why not use the knowledge to improve national PPP policies across the world?
This blogpost builds on the paper “International Public-Private Partnership Policies: Convergence in Themes in International Organizations” which was recently presented at the IRSPM conference in Hong Kong in April 2016. An earlier version was presented at the fourth PPP conference in New York in September 2015, and this full version of the paper is available at CBS Open Archive: http://openarchive.cbs.dk/handle/10398/9196
Carsten Greve is Professor at Copenhagen Business School and Academic Director of the CBS Public-Private Platform. He is the author of several books on PPPs, including Rethinking Public-Private Partnerships (co-editor Graeme Hodge) (out on Routledge in paperback the summer of 2016), and he is currently working on a new book (with Graeme Hodge) on The Logic of Public-Private Partnerships for Edward Elgar Publishing.