Public-Private Partnerships (PPPs) in China: Similarities and Differences in International Practices

The central problem examined in this study is the influence of the design of PPPs in China’s in terms of accountability, efficiency and governmental financial burden. China’s recent commitment to PPPs (2014 – 2017)... [ view full abstract ]

The central problem examined in this study is the influence of the design of PPPs in China’s in terms of accountability, efficiency and governmental financial burden. China’s recent commitment to PPPs (2014 – 2017) reveals a heavy reliance on local and central state-owned enterprises to operate PPPs. It has been observed that this model of China’s experience has led to accountability problems as well as significant financial burdens on the government that contributed to the national government debt (DeNap, 2017). To address this burden, the Ministry of Finance of China (2017) initiated a recent shift in government’s commitment both in design and number of PPPs. This shift represents is a significant step to encourage the private sector involvement. This encouragement was initiated in order to draw private sector resources to complete large, complex infrastructure projects. China’s recent shift of PPPs reveals that understanding and integrating the existing PPP experience is necessary for identifying the successful model. The central research question of this study is as follows: 1. How PPPs are uniquely adopted in China? 2. What are the drivers of the China’s uniqueness? What design changes are identifiable in China’s policy shift with PPPs so that accountability and financial burdens have allocated between the public sector and the private sector? To answer these questions, a careful study on China’s shift will provide a sight for other countries and regions to reconsider an effective PPP design in each special situation.