Public Sector Management and Regulation Working Papers WP-PSM-08 Public-Private Partnerships in New EU Member Countries of Central and Eastern Europe: An Economic Analysis with Case Studies from the Highway Sector Andreas Brenck, Thorsten Beckers, Maria Heinrich, and Christian von Hirschhausen Reprint from EIB Papers, Vol. 10, No. 2 (2005), 82-112 Workgroup for Infrastructure Policy (WIP) Chair of Energy Economics and Public Sector Berlin University of Technology Dresden University of Technology ABSTRACT This paper analyses the role of public-private partnerships (PPPs) for infrastructure development in the new EU member states and candidate countries in Central and Eastern Europe. We survey projects in transport, water, energy, and telecommunications sectors and then focus on the highway sector. Based on theoretical considerations and extensive fieldwork in Hungary, Poland, Croatia, and the Czech Republic, we find that PPPs have not been very successful in the region to date. This is mainly due to the unfavourable institutional environment during the transition period, suboptimal project design, and unrealistic demand projections. However, the conditions for successful PPPs have considerably improved, partly due to EU membership, so that PPPs remain an important option for the second generation of infrastructure projects. Andreas Brenck (
[email protected]) is Visiting Professor, Thorsten Beckers (
[email protected]) and Maria Heinrich (
[email protected]) are Research Associates at the Workgroup for Infrastructure Policy (WIP), Berlin University of Technology. Christian von Hirschhausen (
[email protected]) is Professor of Energy Economics and Public Sector Management at Dresden University of Technology. The authors thank the participants of the 2005 EIB Conference on Economics and Finance for useful comments and suggestions, furthermore Timo Välilä, Thomas Barrett, and Antonio Estache for background discussions and suggestions.