How Government Sees PPPs: We Adopted the Law, Now the Private Sector Should Come Up With the Money!

05.11.2011 ZF English

Public-Private Partnerships (PPP) do not mean that the Government comes with the plot and then sits around waiting for investors to bring the money, do the project and then share the benefits with the state, although quite a few government officials believe this is how things are.

"It is an error of perception. In very few real-life situations the state makes the plot available and then sits around waiting. If this is the approach, it's a mistaken one. PPP entails government funding, government guarantees and indirect funding. PPP means more than putting an idea into practice, it means sharing risks. In order for the investor to take on the full risk, one would need to have an extremely tempting project, but such projects are not very often to come by," says Florian Nitu, managing partner of Popovici Nitu & Asociatii law firm, who specializes in public-private partnerships.

The Government has recently approved a list of 17 major projects (highways, dams, bridges) that it wants to build through public-private partnerships, following the modification of the PPP law through an emergency ordinance last month. How is the Government planning to attract investors into these projects worth tens of billions of euros?

Marin Anton, secretary of state in the Environment Ministry, explained the Government's philosophy yesterday at the seminar titled "The week of responsibility - Companies' social responsibility": "The Government has done its job. Now the private sector is expected to come with projects to the Government. You have to use the legal framework that the country and the Government has made available for you. We want the state to be involved as little as possible. The legislative and the conceptual parts are ready. It is companies' duty to develop their business because this is what they make money from."