Public-private partnerships (PPPs) are agreements between government and private entities that leverage the strengths of both to fund, build, and/or operate large-scale public works projects, typically in areas that benefit the larger society. Examples of these public works projects can range from roads, bridges, stadiums, power plants, telecommunications networks, educational facilities, transportation systems and other infrastructure assets. More recently, a growing number of PPPs have been established for the development of renewable energy projects.

The primary benefit of PPPs is the access to private capital, resources and expertise for otherwise financially limited public works projects. Governments searching for a reliable and affordable means of financing projects often find the PPP model attractive due to the potential savings associated with utilizing private sector efficiency, technological advancement and technical know-how. These factors often result in more cost efficient and higher quality projects than what could be accomplished with public money alone. On the other hand, private entities reap the benefit of a desirable long-term return on investment as well as potential new customers and later profits when public works projects are implemented.

Despite the advantages of public-private partnerships, they also come with some risks that include cost overruns, technical defects, and the inability to meet high quality standards. Efforts to mitigate potential risks and maximize potential advantages are often realized through the use of strong guiding frameworks and external regulatory oversight, such as through charters, regulations and the implementation of dedicated PPP monitoring teams.

In addition to the technical and fiscal risks associated with public-private partnerships, there is also the concern of unregulated or unbalanced partnerships, as well as the perceived exploitation of the public. This can come about if the partnership is driven more by private interests and profits than public ones, or if the terms of the PPP are not carefully negotiated resulting in an unfair deal for the public partners. Regulators and watchdog groups work to ensure a fair deal is in place, but the burden falls on governments and public entities to ensure they are well informed in order to protect the public interest.

Although there is warranted criticism of public-private partnerships, the benefits of this model in terms of financing large-scale projects are hard to ignore. When the right safeguards and external accountability measures are in place, this model of funding and executing public works projects can be a viable option for both governments and corporations alike.