PUBLIC-PRIVATE PARTNERSHIPS AS MECHANISMS FOR RISK MANAGEMENT IN THE WATER SECTOR

Some forms of Public Private Partnership (PPP) have been long since used in the procurement and operation of water infrastructure, as shown in the first part of the paper. The main object of the paper is to highlight the mechanisms of PPP in the water sector and to suggest that in times of economic and financial distress, when both the public sector and the private sector face additional risks and challenges, various models of PPP may be used to manage and mitigate the risks and to improve performance in providing the public services of Water Supply and Sanitation (WSS). The economic and financial risks of the WSS sector are commonly classified in two broad categories but within these broad categories there are many more specific risks. Therefore, we shall analyse some of these main risks and their potential interrelations, by employing several methodologies: literature review, case studies, performance indicators, risk matrix, analysis and synthesis. The mechanisms, features and experiences of PPP in this branch of the water sector are summarized and comparatively analysed, from the viewpoint of risk sharing, leading to some conclusions and recommendations on the opportunity and effectiveness of implementing such arrangements especially in Romania.