The socio-economic outcomes of PPPs have become a focus of the development community. The focus on the building of national strategic infrastructure and the implementation of social services through PPPs projects has a goal of developing sustainable projects that will enhance the socio-economic welfare of the communities.

Whether this implied goal is met or not, sustainable economic outcomes are critical to PPPs. These aspirations can be observed in the varied approaches to and descriptions of PPPs by an international organizations and countries experienced in implementation of PPPs.

The World Bank defines a PPP as a long-term contract (which can be in excess of 30 years for large projects) between a private party and a government entity, for providing improved public asset or service. The private party bears significant risk and management responsibility, and remuneration is linked to performance.

USAID defines that PPPs include partnerhips with the private sector to jointly design, fund, and implement projects for improving social and economic conditions.  Approach includes the objectives of mobilizing ideas, efforts, and the resources of the public and private sector in collaboration with civil society to stimulate economic growth, develop business environment, accsess on healthcare and education services.  This description expands PPPs to include collaboration with civil society partners and introduces an element of corporate philanthropy. Definitions differs from each other, but the aim of PPPs is unchainged – socio-economic development and improvement.

Developing and developed countries agree on the need of private sectors involvement in infrastructure development. So we have to ask ourselves – can we develop PPPs favorable and profitable for involved parties and communities. We can, if national PPP policy and PPP strategies include the following principles and conditions:

Strategy must include 5 main steps: Initiation,   Planning,   Execution,   Monitoring,   and Completion.

There is no doubt that sustainable socio-economic development can be fostered by PPPs , however initiations PPP projects isn’t sufficient: It is necessary to structure and implement projects correctly, to fill the infrastructure and service finance gaps that Georgia is facing.

Elene Nizharadze

PPP CENTER