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Development Finance/PPPs

The private sector in its many forms is becoming an increasingly important actor in development – in economic growth and the provision of public goods and services, the crafting of national development strategies, and international development cooperation. Public-private partnerships (PPPs) are on the rise: around 180 deals are concluded per year since 2006 averaging US$10B per PPP agreement in transportation, US$4B in social sectors, and US$2B in others. This trend is likely to continue in the ongoing aftermath of the global economic crisis that sees many governments strapped for cash and seeking alternative methods of meeting the increasing demands for investment in public sector development.

The cost to the public from these PPPs has often been huge. Governments and the public carry the overwhelming risk in PPP projects, while participating private firms have their returns guaranteed with no risk. Priority and preference are also given to big business and multinationals in these partnerships, instead of prioritising development of domestic micro, small and medium enterprises. PPPs especially in developing countries have had severe ramifications on issues of equity and access, especially for the poor and marginalised. With their lack of paying capacity, combined with governments’ default in ensuring safety nets, the poor ends up marginalised from basic social services that now increasingly ‘come with a price’. PPPs have likewise facilitated human rights abuses, including land grabs and displacement of indigenous peoples, rural and urban communities.

Ensuring people’s development in the face of PPPs has never been more crucial. In furtherance of this aim, and building on our experience in capacity development and policy advocacy, we will work with people’s organisations (POs) in defending public control over basic public services, and in advocating for human rights-based standards in regulating PPPs. We will undertake strategic and in-depth policy research to provide the backbone for critical analysis and policy alternatives on PPPs. We will engage official processes meaningfully, and forge cooperation with various development actors supportive of our goals for strengthened campaigns.

Some of our work on this program theme: