PPP success should be carefully managed
2 October 2025
Commentary
Colin Foreman
Editor
Read the October issue of MEED Business Review
At first glance, it is the same old story for public-private partnerships (PPPs). National visions require billions of dollars of infrastructure spending, while at the same time government budgets are under pressure.
Those twin pressures have not always produced successful PPPs outside the traditional power and water sectors in the region. Results have been mixed by sector and country.
This time around, it is different. While national visions remain as ambitious as ever and state budgets are strained, there has been a shift in mindset as governments realise that PPPs offer more than just an opportunity to get infrastructure delivered for free.
The shift has come from the top as leaders seeks to modernise their economies with a thriving private sector. This reduces the state’s capital expenditure burden, while also giving the private sector an opportunity to operate an asset more efficiently for a profit.
With buy-in from the highest levels of government, there have been legislative changes and new entities formed to help make PPPs a success.
These changes have enabled a series of pathfinder projects across the region in recent years that demonstrate that the model does work and even offers benefits that may not have been initially envisaged – such as increased school attendance at PPP schools in Saudi Arabia.
As the region now looks to build on that success, there is a risk that governments could overload what is still a nascent market. The capacity to deliver PPPs remains limited, and while it is growing, it is not expanding as quickly as the project pipeline.
Governments should ensure that projects are phased with market capacity in mind. If they do not, the danger is the market will collapse under its own weight, as projects may not be competitively tendered, could fail to proceed and may undermine the confidence built up in recent years.
READ THE OCTOBER 2025 MEED BUSINESS REVIEW – click here to view PDF
Private sector takes on expanded role; Riyadh shifts towards strategic expenditure; MEED’s 2025 power developer ranking
Distributed to senior decision-makers in the region and around the world, the October 2025 edition of MEED Business Review includes:
|
> AGENDA 1: A new dawn for PPPs
> AGENDA 2: GCC pushes PPPs to deliver $70bn pipeline
> POWER DEVELOPER RANKING: Acwa Power consolidates power sector dominance
> IPPs: GCC enters pivotal year for IPPs
> ACQUISITION: Wood takeover could boost Sidara profits
> INTERVIEW: SLB strives to boost regional standing
> SAUDI MARKET FOCUS: Riyadh strives for sustainable growth
|
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