Given the paucity of public resources, it is important to consider relying on the private sector for financing public investments and infrastructure. There are considerable expectations concerning Public-Private-Partnerships (PPPs) in supplementing public resources, but also risk sharing with the public sector. However, these contracts are subject to abuse, given asymmetric information, and game-play across levels of government that lead to the risks being borne by the central government or subsequent administrations. Specialized agencies can play a useful role in supporting subnational governments with the complex contracting arrangements needed for PPPs. We see that strengthened Public Financial Management is needed, to track the build-up of liabilities at the subnational level, and also own-source revenues to ensure accountability. Uncertainty, including with climate change, may require different arrangements-and the options are addressed in a subsequent paper Ahmad, Vinella and Xiao (2017), but the risk-sharing aspects of PPPs may be relevant in many cases.
CITATION STYLE
Ahmad, E., Bhattacharya, A., Vinella, A., & Xiao, K. (2017). Involving the private sector and ppps in financing public investments: Some opportunities and challenges. In Fiscal Underpinnings for Sustainable Development in China: Rebalancing in Guangdong (pp. 123–159). Springer Singapore. https://doi.org/10.1007/978-981-10-6286-5_6
Mendeley helps you to discover research relevant for your work.