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PPP: Private Gains, Public Costs

Governments across the globe are now being encouraged to partner with private for-profit entities in various fields that were formerly the exclusive or dominant turf of public agencies, in what has come to be known as Public-Private Partnerships (PPPs). Private sector participation in building and operating infrastructure and other public service facilities, under some contractual arrangement with the government, is increasingly packaged as a win-win solution, which on one hand taps private investment, management, and technical capacity, while on the other hand supposedly benefits the government and the public through increased revenue and improved service.

However, a growing body of evidence shows that PPP schemes on paper may not show imbalances in how costs and benefits, risks and opportunities, are shared between the government and private partners, resulting in eventual failures and unmet public needs. In short, governments especially in developing countries must reassert the primacy of public service, democratic regulation and social accountability over private profit, and continue to develop better alternatives to untrammeled privatization.

Added by View user profileD C on January 19, 2012