Public-private partnerships in developing countries: are infrastructures responding to the new ODA strategy?

The developing world needs far more financing for infrastructure than can be provided by domestic public finances alone and through Official Development Aid (ODA). Around middle 1980s a new strategy based on the use of public-private agreements, relying on ODA to enhance the quality of projects, reduce risks and raise profitability was gradually implemented for the provision of infrastructures and public utilities. This paper evaluates the more typical forms of private sector involvement (PSI) and its actual importance (by type of public utility and by region) and shows that the new strategy has failed in improving the provision of infrastructures in the developing world. Copyright © 2007 John Wiley & Sons, Ltd.