Is public-private partnership a panacea for infrastructure development? the case of Beijing National Stadium

Abstract

Public-private partnership (PPP) is such a hot concept that nowadays it is discussed everywhere be it a public sector management journal or a public sector management conference. Governments subject to severe fiscal pressure in developing countries like China, where PPP law is not in place yet, regard it as a panacea or fixed solution for infrastructure development. This paper hence attempts to provide reference to this point by investigating the Beijing National Stadium. There was a significant change in the Project Company on 20 August 2009. Three main reasons for the contract change were (1) wrong identification of the retractable roof as one of the output specifications, (2) adoption of PPP without a careful feasibility study and (3) strong government interference like suspension of selling name-right and prohibition of holding small-scale or small events. It was found that PPP would not be more appropriate than conventional procurement in this project. It was therefore proved that PPP is not a panacea for infrastructure development. It is expected that a review of the Beijing National Stadium can provide valuable information for when and how to implement PPPs. More considerations on receiving value for money in the whole project lifecycle (including the operation) should be taken in a PPP project. © 2014 © 2014 Taylor & Francis