Blurring the boundaries: private equity and public-private partnerships

This session continues the theme of “leveraging” by focussing on two further recent trends IFI financing. The first part will look at equity investments, whereby IFIs either directly own shares in companies, or channel money into “private equity” funds that own these companies (often to turn a quick speculative profit before exiting). The second part of the seminar turns its attention to public- private partnerships, in particular the use of “special purpose vehicles” in funding the creation of new infrastructure. It also examines the key drawbacks that have been identified in such forms of funding, including their role in escalating project costs, and in transferring the risks to the public sector while inflating private sector profitability.

Core reading

Dexter Whitfield, PPPs – Partnership or Plunder? [Extract]

Kavaljit Singh, Private Equity Funds, extract from Fixing Global Finance: A Developing Country
Perspective on Global Financial Reforms

Background reading

Bracking S and Hulme D, Lawson, D, Sen K and Wickramasinghe, D. 2010. The Future of Norwegian Development Finance. Oslo: Norad, p.8-12

Bracking, S and Ganho A S. 2011. Investing in Private Sector Development: What are the Returns?.
Oslo: Norwegian Church Aid, p.42-45.

Bracking, S. “How do Investors Value Environmental Harm/Care? Private Equity Funds, Development Finance Institutions and the Partial Financialization of Nature-based Industries.” Development and Change 43, no. 1(2012) : 271-293

Singh, K. (2008) Taking It Private : The Global Consequences of Private Equity

Whitfield, D. (2010) Global Auction of Public Assets – Public Sector Alternatives to the
Infrastructure Market & Public Private Partnerships Spokesman Books

Presentations
Sarah Bracking, University of Manchester
PowerPoint

Dexter Whitfield, European Services Strategy Unit
PowerPoint

Audio (download)