Interactional risks associated with parties to a PPP project
Abstract
Public private partnership (PPP) projects involve a variety of project governance structures. Common among all these varied structures is the long-term contractual period between multiple public and private entities. These entities include government, concessionaire and financier. The increased uncertainty of a long-term contract duration coupled with the involvement of multiple actors proves to be a challenge to developing risk mitigation strategies in PPP. Therefore, it is necessary to systematically collect, assess and frame the risks associated with these projects and explore associated dynamics. There has been a recent shift towards focusing on interactions of parties due to shared risks. Exploring the interactions among the parties in risk and renegotiation scenarios can help in understanding and mapping out the potential outcomes and multiple strategies for each party. The main objectives of this dissertation are: 1) Establish risks affecting PPPs: Macro, Market and Project level; 2) Identify timeline for the identified risks where they occur in or affect a project phase; 3) Analyze three-party interactions in the context of identified risks as well as renegotiation scenarios; and 4) Develop a model to quantify the actions/interactions between parties and the resulting outcome. This is tackled through the use of techniques such as Systematic Literature Review (SLR) and Delphi Technique to create a framework/model to assess risks in PPP projects. Following that scenario analysis, three-party interactional analysis and simulation were conducted to model the risk and renegotiation scenarios and analyze the range of potential outcomes for parties to the risk. This combined approach can help planners to prepare for a range of complex and uncertain scenarios. This dissertation extends the current literature by (i) integrating the framing of the risks with their modeling and simulation, and (ii) expanding the analysis of interactions to three parties in risk and renegotiation scenarios. Two case studies are conducted to showcase the proposed framework. This framework can be used by any party to a PPP project to assess risks and simulate risk scenarios to understand the outcome of the different strategies available. This can be used to propose mitigation strategies for each party. Interactional analysis, as proposed in this dissertation, has been introduced to simulate three-party interactions specifically in PPP risk scenarios. However, it can be further applied to other three-party situations in different project delivery methods such as for Integrated Project Deliver (IPD).
Degree
Ph.D.
Advisors
Hastak, Purdue University.
Subject Area
Civil engineering
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