Failure Mechanisms in International Water PPP Projects: A Public Sector Perspective

Abstract

Public–private partnerships (PPPs) have been embraced by governments worldwide for better project governance and improved value for money by sharing risks and rewards with the private sector and exploiting private capital, technologies, and management skills. Although there are a large number of studies that explore the success determinants of PPP projects with numerous publications, research on the root causes of the failure of PPP projects is scarce. Such research is all the more important in view of the many failed PPP projects that suffered from disastrous consequences, including some that were abandoned by sponsors and some bailed out by the host governments, resulting in substantial controversy, criticism, and conflict. Through a systematic research approach that combines literature review, case studies, a questionnaire survey, and statistical analysis, this study (1) categorized six types of water PPP failure, (2) identified 33 failure drivers occurring in different stages of the PPP life cycle, (3) evaluated the relative significance of the 33 failure drivers, and (4) formulated an overall failure map that integrates 24 failure mechanisms, each resulting in a certain type of failure. Outputs of this study would facilitate stakeholders in monitoring the failure drivers in different PPP stages and developing reactive as well as preventive measures to effectively remove or mitigate their impacts toward the successful development of water PPP projects.