Exploring the determinants of government ownership in port public-private partnerships

Abstract

Public-private partnership (PPP) is a popular form of port investment in developing countries. Collaboration with the government can be critical to the success of a port PPP, which may also eventually affect a firm’s risk and performance. This study empirically investigates the impact of project-specific and company-specific factors on government ownership in a port public-private partnership in developing countries. Results show that a higher proportion of government ownership in port PPPs is associated with a larger PPP investment amount, a higher historical proportion of government ownership, and presence of both foreign and other types of private investors. On the other hand, presence of bidding, local private investors, and vertical and horizontal integration are negatively correlated with the proportion of government ownership. This study can provide private investors with a reference framework to identify potential port PPP projects to enter based on their preferences, capabilities, and portfolios. It can also assist inexperienced port authorities in analysing when to take ownership of port PPPs.