Diversification of Private Participation in Public Infrastructure in Developing Countries

Abstract

Public Private Partnership (PPP) is widely practiced in delivering public infrastructure. PPP utilizes private finance and management strengths. A number of countries worldwide have diverse demands. Political, institutional and macroeconomic conditions are involved in PPP in a wide range of public infrastructures and services. In diverse situations, countries worldwide are involved in a multiple number of PPP projects. With the proliferation of wide engagement in PPP, this paper examines how countries are attracting the private sector in the development of public infrastructure. The paper also determines what is engaged in PPP infrastructure using the multiple discrete-continuous extreme value (MDCEV) model. By examining the 4,423 projects from 86 developing countries, we found that countries are likely to be involved in telecommunication projects, followed by the energy and transportation and water projects. Water is one of the least preferred sectors among the four major infrastructure sectors provided by the PPI database of the World Bank.