What results has ukraine achieved for almost 19 years

This preview shows page 5 - 7 out of 9 pages.

What results has Ukraine achieved for almost 19 years of work of PPP mechanisms? From 1999 to the present, there have been 192 initiated public-private partnership projects. This is the first impressive achievement, putting Ukraine at once several steps higher than the country with 70 PPP projects on average. At the same time, 182 out of 192 public-private partnerships (or 95%) were initiated in the form of concessions. Since this form of the contract provides for the payment in favor of the state of the exclusive right to use the object, this means that most of the projects were planned to be recouped by collecting fees from users. Only 66 out of 192 projects (more than 34%) were successful. This means that more than two-thirds of the projects failed due to high losses and termination of contracts. And this is a lot, because, given the insignificant variation between different groups of countries in terms of income, the percentage of failures for low-income countries do not exceed 7%, while for countries with high incomes it is below 4%. 1.1. Lessons learned One of the most important lessons relates to the development and analysis of PPP projects. To make a decision on building a partnership between public and private partners, you should make sure of its economic feasibility. Practice shows that only 10-15% of initiated projects should be implemented on the basis of public-private partnerships. The reason for this is the possibility of optimizing the distribution of risks between public and private partners, which makes such a partnership more profitable than the way these services are now provided by state and municipal enterprises. So, the percentage of PPP failures in Ukraine is largely due to the general regulatory environment in which the private partner lacks advantages over the state partner. Not all concessions are needed everywhere, because the main problem is not always the lack 5
Image of page 5
of investment. So, for water supply and drainage, management / rental contracts are more common (up to 70% of projects). In Ukraine, on the contrary, almost all contracts are concessionary. Consequently, the load of investments is transferred from the local budget exclusively to users. Usually, the number of proposals initiated by a purely business should be alarming, since the competitive advantage of a private operator lies in its experience in testing / applying innovative technical solutions and the availability of registered patents. Technologically intensive industries such as information technology and communications benefit from this. However, for transport, energy, and water supply, the technological advantages of business are fading into the background, and company management skills are becoming more important. In particular, the success rate of PPP projects is higher for projects initiated by a public partner compared to those initiated by a private partner: 98% versus 76% for low- income countries and 99% against 90% for high-income countries.
Image of page 6
Image of page 7

You've reached the end of your free preview.

Want to read all 9 pages?

  • Fall '19
  • Public–private partnership, Public-private partnerships

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern

Stuck? We have tutors online 24/7 who can help you get unstuck.
A+ icon
Ask Expert Tutors You can ask You can ask You can ask (will expire )
Answers in as fast as 15 minutes
A+ icon
Ask Expert Tutors