Public Private Partnership and Sustainable Infrastructural Development in Developing Nations: Problems and Prospects

Abstract

— In developing countries, with scarce public funds, Public-Private Partnerships (PPPs) are used to solve infrastructure problems. This paper reviews the concept of PPPs, its key models, importance, obstacles for implementation, prospects and ways to improve the sustainable infrastructural development through PPPs. The conceptual review method is used in this study, based on the literature and institutional reports. The analysis shows that PPPs have the potential to stimulate infrastructure financing, through greater operational efficiency, technology transfer, better public service delivery, and economic growth and sustainable development. However, they are limited in effectiveness due to insufficient legal and regulatory measures, corruption, political instability, institutional capacity issues, financing problems, and project management issues. The paper finds that transparent governance, effective regulatory mechanisms, proper risk allocation, stakeholder involvement and institutional capacity are key elements to the successful implementation of PPPs. It calls for reinforcing the legal, institutional and regulatory environment, encouraging accountability, enhancing project preparation in developing countries, increasing access to long-term financing, and integrating the concept of sustainability into infrastructure planning, in order to build the developmental potential of PPPs in developing countries.