Last Updated:
20 Jan 2021

Fiscal Risk in PPPs: Defining the Problem

Quick Reads on InfraFinance Author: David Duarte

Public-Private Partnerships (PPPs) can sometimes be perceived as a means for delivering infrastructure for free. A more nuanced view is that they are a mechanism to overcome fiscal constraints, a tool to realize public investments—especially large public infrastructure—when the government does not have the resources to implement these projects on budget. Some argue, and perhaps rightly so, that often governments enter PPP contracts without fully understanding their fiscal implications or impact.