Athena Roumboutsos

Public-private partnership projects in Greece: risk ranking and preferred risk allocation

Project participants, through experience, have an initial perception and predisposition towards risk and the types of risks they are willing and able to undertake. This is equally true for parties interested in public–private partnership (PPP) projects. These initial positions have been registered for the major Greek PPP market stakeholders potentially involved in a PPP arrangement through a survey covering all candidate construction companies, interested financing institutes and a number of public sector entities to be involved in PPPs. Findings revealed that stakeholders were, for the majority of risks identified, in agreement as to preferred risk allocation. Risk allocation preferences for construction companies were compared with similar findings for the UK, a mature PPP market, indicating a possible learning/maturing process based on the particular country background. Conclusions add to other surveys carried out on the subject and should enable public sector clients to establish a more efficient framework for risk allocation, thus reducing negotiations prior to contract award and minimizing the risk of poor risk distribution.

Environmental sustainability in seaports: a framework for successful innovation

Environmental sustainability in the port industry is of growing concern for port authorities, policy makers, port users and local communities. Innovation can provide a solution to the main environmental issues, but often meets resistance. While certain types of technological or organisational innovation can be satisfactorily analysed using closed system theories, in the case of seaports and in particular in the area of environmental sustainability, more advanced conceptual frameworks have to be considered. These frameworks need to be able to account for the multiple stakeholder nature of the port industry and of the network and vertical interactions that environmental sustainability calls for. This article investigates successful innovations improving environmental sustainability of seaports. The proposed framework builds in part on research concepts developed in the InnoSuTra EU FP7 project. From a methodological perspective, this article develops a method for quantifying the degree of success of innovation with respect to a set of specific objectives. Several case studies are used to test the framework against real innovation examples, such as onshore power supply, or alternative fuels. In this article, we argue that only those innovations that fit dynamically port actors’ demands and the port institutional environment stand a chance to succeed.

Public-private partnerships and investments in innovation: the influence of the contractual arrangement

Public-private partnership (PPP) policy strategies emphasize the ability of PPPs to foster innovation. Evidence reported in literature supports less the inherent quality of PPPs for innovation and more the importance of contributing factors. The contractual agreement is the setting of these factors. In this context, an analytical model based on behavioural economics is presented, with boundary conditions reflecting various contractual configurations. The analysis indicates why, from a purely economic point of view, the private party in a PPP arrangement has an incentive to invest in low risk incremental innovations, which impact on, and positively effect, cost savings during construction and operation. It is also identified that further innovations are hampered by the ability to produce verifiable improvements correlated to performance. Findings contribute to the subject of public procurement for innovation in PPPs and support public authorities regarding the rationale, potential and necessary framework conditions for the use of public procurement as an innovation policy tool.

Allocating Revenue Risk in Transport Infrastructure Public Private Partnership Projects: How it Matters

Abstract Transport infrastructure public private partnership (PPP) projects are very diverse and complex in nature not only because of their mode-specific intricacies but also because of their inherent economic characteristics that relate to the scope of involvement of the private sector in the project, the large sunk costs incurred, and ultimately, the competition to which these projects are exposed. The allocation of revenue risk is of paramount importance for the successful implementation of such projects and a sub-optimal allocation may lead to project structuring that is unnecessarily expensive and vulnerable to failure. At the same time, the revenue risk depends critically on the remuneration model used (user-based versus budget-based) and may, in turn, take the form of demand risk, counterparty risk or combinations of the two. This review explores the issues related to revenue risk allocation for transport infrastructure PPP projects. Overarching principles for the allocation of revenue risk that transcend mode-specificity are identified and compared to case studies generated in the context of the COST Action TU1001. The results show that theory and practice are divergent, leading to sub-optimal structuring and exposing projects to potential failure.

Public private partnerships in transport: theory and practice

Purpose – The purpose of this paper is to provide an introduction to the Special Issue on public private partnerships in transport: theory and practice, to justify its need, to highlight key issues and propose future research in response to current and future challenges. Design/methodology/approach – Setting the context of public private partnerships (PPPs) in transport, the key issues of this infrastructure and service delivery model are highlighted through the authors’ critical description of the contributions in the Special Issue, which present a balanced presentation of theory and practice. Findings – The paper summarises critically and constructively the findings of the contributions to the Special Issue and based on these puts forward the need for research in new assessment methodologies and the need to develop appreciating projects. Research limitations/implications – Issues identified in combination with current macro-economic and social developments lead to the proposal of research needs that sho...

A strategic partnering framework analysis methodology for public‐private partnerships

Purpose – The purpose of this paper is to view and analyse public‐private partnerships (PPPs) under a strategic partnering approach between the key parties involved, i.e. public sector, private sector and lenders, and their business environment.Design/methodology/approach – A strategic partnering framework analysis methodology has been devised based on existing and well‐known business strategic analysis tools (the political‐economic‐social‐technological (PEST) and strengths‐weaknesses‐opportunities‐threats (SWOT) analysis). The methodology consists of modules and may be used to identify the potential of strategic partnering in a sector and/or country and/or for a particular project in a procurement process. By using appropriate modules of the methodology, public sector partnering requirements or the market potential for PPPs, in general, may be assessed.Findings – The small‐scale application of a module of the methodology is demonstrated through an international consultation on the influence of the presen...

Information technology network security risk assessment and management framework for shipping companies

Shipping companies are high-vulnerability information handling organizations (HIHOs). In the past, such companies used exclusively HIHO private communication networks and own satellite resources in order to share and transport sensitive information. In recent years, the ability for the HIHO network users to exploit the advantages of the low-vulnerability information handling organizations’ (LIHOs) value added networks, has led to the need for augmentation of the HIHO networks. In the maritime sector, a push-and-pull effect on the need and demand to transfer information onboard and ashore has led many companies to experiment with interconnected HIHO and LIHO open distributed systems and networks, for their ship-to-shore communications. Security then becomes an issue in a domain, onboard–ashore data transmissions, where little information on the level of risk is available. This paper proposes a risk assessment and management framework to assist in countermeasure selection and level of LIHO network use definition. The model is ultimately applicable where information on potential risks and their impact is minimum and simultaneously changeable. The model is connected to a security profile for interconnected HIHO and LIHO open distributed systems and networks.

A PPP renegotiation framework: a road concession in Greece

Purpose – The purpose of this paper is to present a framework approach to guide the identification of potential public private partnership (PPP) renegotiation outcomes is presented. The framework is applied to a road concession project under renegotiation in Greece. Design/methodology/approach – The framework combines the estimation of stakeholder payoffs with respect to the various strategic options available. Their potential acceptance is evaluated with respect to the power distribution within the stakeholder network. The contextual environment determines the respective power position of each stakeholder in the network. Findings – The proposed framework is applied to a road concession case in Greece, under renegotiation as a result of the economic crisis. The analysis highlights the importance of the contextual environment and the limitations of solutions that seem “satisfying” for all stakeholders involved. Social implications – The framework is designed to guide both public and private parties involve...

Public Private Partnerships in Transport Infrastructure: An International Review

The need to deliver transport infrastructure to foster economic requirements and address societal challenges has placed a strain on governmental budgets internationally. Over the past decades, governments worldwide have experimented with different approaches of awarding and implementing long-term (25–50 years) concession-type contracts to private actors and pursued policies to this effect. These varying types of contractual agreements have been considered under the general term ‘public private partnerships (PPPs)’. They are set up to finance, design, build and operate infrastructure assets (including transportation) traditionally funded and operated by the public sector. Over the period 1990–2013, the total number of PPP projects in Europe is estimated to be over 1600, representing an investment of over 300 billion Euros, setting Europe as the key region of PPP development. The transport sector has taken extensive advantage of the PPP delivery model. This is mainly due to three major drivers: the growing demand for transportation services (cf. European Commission [EC], 2011); the ability to secure potential revenue cash flows through user payments (directly through, e.g. tolls or indirectly through taxation); and European transport deregulation policy supporting the introduction of the private sector in domains traditionally addressed by the state, leading to ‘lesser state’ — ‘New Public Management’ regime (Institute of Public Policy Research, 2001). When describing the PPP model of public infrastructure and service delivery, there is no widely accepted definition. Nonetheless, most definitions include the following characteristics (cf. EC, 2004; European PPP Expertise Centre (EPEC) PPP guide, 2011; Grimsey & Lewis, 2007; Hodge & Greve, 2005; Osborne, 2000): the cooperation between public institutions and the private sector to deliver public infrastructure projects and/or services (e.g. transport, energy, water and others); the typically long-length of the contractual agreement; the transfer, in total or in part, of certain project risks to the private sector; a focus on the specification of project outputs rather than project inputs; the introduction of private financing; and the remuneration of the private sector for services delivered with schemes that range from end-user direct payments (e.g. motorway tolls) to availability fees/shadow tolls or other forms of public payment (e.g. subsidies), or a combination thereof. These characteristics have also been the focus of significant research, referring to questions such as:

Evaluating the impact of decision making during construction on transport project outcome.

Decisions made during the project construction phase may bear considerable impacts on the success of transport projects and undermine the ex-ante project evaluation. An innovative and holistic approach has been taken to assess and address this issue by (a) examining the decision process and procedure during project construction, through a field survey, (b) assessing the impact of decisions made during construction on respective transport project and, finally, (c) developing a quality monitoring framework model which links decisions made during the project implementation (construction) phase with the ex-ante and ex-post project evaluations. The framework model is proposed as a guiding and support tool for decision makers.