Challenges and lessons learnt in the financing of public infrastructure in South Africa, Czech and Slovak Republics: a comparative study

[摘要] English: The aim was to explore how to optimize public-private partnerships in public infrastructureinvestment and development as an alternative financing instrument by identifying and developingcore success factors and establishing key lessons learnt from failed projects. The study,underpinned by a constructionist epistemological viewpoint, used the case study approach andexpert interviews to undertake an empirical study in South Africa and the Czech Republic.Purposive sampling was used to identify the interviewees as well as two case studies that fittedthe context of the study. Semi structured interviews and documents were utilized as means ofcollecting data. Being exploratory and qualitative in nature, the study applied qualitative dataanalysis techniques comprising a 3-step coding process and theme building. The findingsrevealed that economic, financial and social factors were predominantly the main factors whichconstrain public finance in public infrastructure investment. Implications of constrained publicfinance in public infrastructure were classified as having social, economic, investment and fiscalconsequences. Findings further revealed that optimization of public-private partnerships requiresimproved comprehensive knowledge, methodology and implementation as key strategies.Further, the study developed five core success factors of public-private partnershipsimplementation ranked as follows: 1st ranked core factors were legal and regulatory frameworks,technical feasibility studies and public servant's readiness. The 2nd ranked factors were riskallocation, monitoring and evaluation. The 3rd ranked factors were decision-making, projectprocurement, cost benefit analysis, public institution readiness and in-house technical skills. The4th ranked factors were risk management, good partnerships, methodological support, clear visionand competition. The 5th ranked factors were ownership, governance, project benefits, capacitybuilding, financing capacity, project management, land acquisition, environmental impact analysisand contract management. Another significant finding was establishing core lessons from failedpublic-private partnerships projects. Among these critical lessons, project management lessonswere found to be predominant. Other key lessons centred on institutional structure, lessons fromfailure, socio-economic purpose, shared vision, methodological support, legislative and regulatoryframework, knowledge management and avoidance of financial losses. The findings showed thatpublic decision makers require comprehensive public-private partnerships knowledge, becausethese arrangements are characterized by inherent conflicts and opportunistic behaviours, whichrequire to be well managed and/or mitigated in order to optimize their implementation. Thefindings revealed that conflicts in public-private partnerships are primarily caused by asymmetricalinformation which leads to adverse selection strategies and moral-hazard problems due to agents' opportunistic behaviour. Overall, the findings suggested that if the public sector did not effectivelymonitor construction firms in a well-structured project framework, the agents would maximizeprofits, increase transactional costs and undermine the potential of public-private partnerships.Results inferred that when public-private partnerships are appropriately structured withreasonable incentives, they can contribute to economic, financial, social, environmental andtechnological benefits. This study provides an overview of challenges associated with theimplementation of public-private partnerships. It highlights useful lessons and makes acontribution by identifying and examining core success and failure factors which can improvepublic-private partnerships implementation. Rather than re-invent the wheel, key lessons can belearnt from failed projects and applied in practice to improve successful implementation. The studyconcludes that public-private partnerships are an alternative financing instrument in publicinfrastructure investment and development with long-term suitability.

[发布机构] University of the Free State