The impact of enabling environment drivers on participatory investment between the public and private sectors in the energy sector

Abstract

The research aims to analyze the impact of the drivers of the enabling environment, represented by the macroeconomic stability index (GDP, inflation, foreign exchange reserves and the ratio of debt reserves to short-term foreign exchange). And the financial market stability index (the volume of credit provided to private sectors, value of shares traded) on public-private partnerships PPP in financing infrastructure in the energy sector for selected countries. The drivers of the enabling environment in general are considered one of the main pillars in the process of partnership between the public and private sectors, and the tangible results of the PPP have a clear impact on the economic construction of countries that seek advancement and development in all directions. on the other hand, there is an urgent need to expand the scope of infrastructure projects, as a result of the widening gap between the demand for infrastructure and the its supply, and then increasing the volume of its financing. This requires the public sector to move towards PPP, which has capabilities and efficiency in implementation and management. The research adopted the ARDL model to perform the regression, using longitudinal data for a group of selected countries (Brazil, Colombia, India, Mexico, Peru, Philippines, China, Bangladesh, Russia, Thailand) for the period (2000-2020). It was found that the effect of GDP and foreign cash reserves was positive, while the effect of inflation, the ratio of the ratio of short-term debt-to-foreign exchange reserves and the credit granted to the private sector ratio was negative, while it was proven that there is no significant effect of the value of traded shares on PPP investment. On the other hand, it was found that the flexibility of participatory investment in relation to changes in the GDP, foreign monetary reserve, the ratio of the ratio of short-term debt-to-foreign exchange reserves, and credit granted to the private sector ratio was low. While it was found that PPP investment is highly flexible to the change in the rate of inflation. Which emphasizes the importance of securing a stable macroeconomic environment for the purpose of stimulating PPP investment in the energy sector.