Public-private partnerships (PPPs) offer governments an opportunity to access private capital and skills to build or upgrade, operate and manage public water infrastructure services hitherto provided and run by the public sector. Access to private finance speeds up the provision of public water services in developing countries, where many governments face budgetary constraints. However, the water sector attracts the least investment flows in developing countries, well below other infrastructure sectors. This paper aims to present the results of an investigation of critical success factors (CSFs) required for attracting the private sector in water supply projects.
A structured questionnaire survey of international PPP expert opinions was conducted.
Analysis results show that the CSFs for attracting the private sector to water PPPs include political commitment from elected leaders toward PPPs for water supply; existence of a dedicated PPP unit; strong and competent public water authority; adequate fiscal capacity of a national/subnational authority; public acceptance and support of involvement of the private sector in water services; a well-designed PPP contract; existence of enabling policy and legal frameworks to support water PPPs; and profitability of water supply project(s) to attract investors and lenders. Agreement analysis also indicates a strong to very strong agreement on the significance and rankings of the CSFs.
The research findings provide an insight into a number of important issues to enable greater private participation in water supply projects, most of which aim at reminding governments of some key areas that need reform and enabling greater commitment among them to undertake such reforms. Given the limited empirical research on CSFs for attracting private participation, this research makes a contribution to the body of knowledge about private involvement in the water sector of developing countries.
This paper is based on the outcome of a larger-scope research project entitled “Risk allocation model for public-private partnership (PPP) projects”, which is fully funded by the International Postgraduate Scholarship from The Hong Kong Polytechnic University, from which other papers have been generated with similar or different objectives and share common research background and/or methodology, where some publications overlap (Ameyaw, 2014; Ameyaw and Chan, 2015b). The authors are grateful to the industry experts who kindly participated in the questionnaire survey for this research.
Ameyaw, E.E., Chan, A.P.C. and Owusu-Manu, D.-G. (2017), "A survey of critical success factors for attracting private sector participation in water supply projects in developing countries", Journal of Facilities Management, Vol. 15 No. 1, pp. 35-61. https://doi.org/10.1108/JFM-06-2016-0027Download as .RIS
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