Public-Private Partnerships and the Value of the Process: The Case of Sub-Saharan Africa

Abstract

In the current age of fiscal austerity, Public-Private Partnerships (PPP) continue to be a dominating force as a policy tool to help plug widening funding gaps and deliver vital infrastructure. There is much debate over PPP models; risk allocation and financing. Partnerships UK is currently revaluating its Private Financing Initiative (PFI) model, questioning whether competitive dialogue brings value to the process. France recently announced PPPs worth €60bn to come to market in the coming decade, developing economies’ appetite for PPPs is increasing. According to a World Bank study Africa in particular needs around US$16.5 billion a year, to reach the Millennium Development Goal (MDG) for improved water access in Sub-Sahara Africa. When over 300 water Public-Private Partnerships (PPPs) were evaluated, contract type mattered to some degree, but not significantly. There were reportedly exceptional increases in the number of connections after the private sector was involved, but without an increase in financial investment. If financing and contract type were not a significant game changer, how else can we explain success and failures of different PPPs?