Public-Private Partnership (ppp) Handbook

participation
Management may not have 
adequate control over key 
elements, such as budgetary 
resources, staff policy, etc.
LEASE
 CONTRACTS
Responsibility for manage
-
ment, operations, and specific 
renewals
Public
10–15 years
Private
Public
Shared
Moderate
Portion of tariff revenues
Initial contract only; sub
-
sequent contracts usually 
negotiated
Improves operational and com
-
mercial efficiency;
Develops local staff
Potential conflicts between 
public body which is respon
-
sible for investments and the 
private operator
CONCESSIONS
Responsibility for all operations 
and for financing and execu
-
tion of specific investments
Public/Private
5–
0 years
Private
Private
Private
High
All or part of tariff revenues
Initial contract only; sub
-
sequent contracts usually 
negotiated
Improves operational and com
-
mercial efficiency; 
Mobilizes investment finance;
Develops local staff
How to compensate 
investments and ensure good 
maintenance during last 5–10 
years of contract
BOT
Investment in and operation 
of a specific major component, 
such as a treatment plant
Public/Private 
Varies
Private
Private
Private
High
Mostly fixed, part variable 
related to production 
 
parameters
One time only; often 
negotiated without direct 
competition
Mobilizes investment finance;
Develops local staff
Does not necessarily improve 
efficiency of ongoing 
 
operations;
May require guarantees