Public-private partnership, and why so few happen

Ukraine has had a public-private partnership framework for years, and the number of large completed projects under it remains small. Understanding why matters, because reconstruction will need this instrument.

What a PPP actually requires

A public authority capable of specifying what it wants over twenty years. A revenue stream the private party can rely on — either user payments or availability payments from the state. Risk allocated to whoever can manage it. And a contract robust enough that a change of government does not end the project.

The last requirement is the one that fails most often, and not only in Ukraine.

Why projects stall here

Preparation capacity. A PPP requires feasibility work, legal structuring and financial modelling before a tender, and a municipality cannot fund that from its own budget.

Bankability. A lender must be satisfied that the revenue is real and the counterparty will pay for twenty years. Where the counterparty is a state with a variable payment record, that is a hard case to make.

And political durability. Investors have watched projects renegotiated after elections, and the memory of that affects every subsequent transaction.

What has worked

Port concessions, which succeeded because the asset was clearly defined, the revenue was commercial rather than budget-dependent, and the international financial institutions involved gave lenders confidence.

That is the template: a defined asset, a commercial revenue stream, a credible partner alongside the state.

Why it matters now

Reconstruction includes a great deal of infrastructure that could be delivered this way — waste, water, heating, transport terminals. Whether it is depends on preparation capacity, and that is fundable now.

The difference between having a law and having a project is whether it is written down who carries the risk. The public side does not want to guarantee demand and the private side will not enter without a guarantee; every project caught between the two waits for years. The only thing that closes that gap is the first few projects actually completing — an example persuades more than legislation does.