Since its implementation in 2014, the Public-Private Partnership (PPP) has played a certain role in improving public services and stimulating effective investment in the past decade, but there are also some problems that need to be solved urgently. Since the clean-up and verification of PPP projects across the country in February 2023, both social capital and local government departments at all levels, as well as people from all walks of life who are concerned about the development of the PPP model, are looking forward to the next policy decision of the state on PPP.
In order to implement the decisions and arrangements of the CPC Central Committee and the State Council, further deepen the reform of the infrastructure investment and financing system, and effectively stimulate the vitality of private investment, the new PPP mechanism will be launched soon. In accordance with the Guiding Opinions on Standardizing the Implementation of the New Mechanism for Public-Private Partnership (hereinafter referred to as the "New Mechanism"), projects that have not completed the bidding and procurement procedures before the clean-up and verification of PPP projects in February 2023, as well as PPP projects that will be launched in the future, will no longer be subject to the Notice of the General Office of the State Council on Forwarding the Guiding Opinions of the Ministry of Finance, the National Development and Reform Commission and the People's Bank of China on Promoting the Public-Private Partnership Model in the Field of Public Services (Guo Ban Fa [2015]) No. 42), all of which should be implemented in accordance with the new mechanism. Different from the past, the new PPP mechanism has made major innovations in many aspects.
Giving priority to private enterprises to participate in the new mechanism of public-private partnership is an important measure to promote market-oriented reform and stimulate the vitality of private enterprises. The introduction of this new mechanism will help break the government monopoly, promote market competition, and provide more development opportunities for private enterprises. At the same time, this is also a return to PPP, the essence of the market economy of government-market cooperation, and a manifestation of improving government efficiency, which will help improve the efficiency and quality of project construction.
Private enterprises have certain advantages in operation and management, technological innovation, cost control, etc., and participating in public-private partnership projects can give full play to their innovation ability and competitiveness. At the same time, by giving priority to the participation of private enterprises, it can also promote the optimization of resource allocation and improve investment and social benefits.
However, for projects with a high degree of marketization and weak public attributes, it is necessary to pay attention to preventing private enterprises from excessively pursuing economic interests and ignoring public interests. When selecting private enterprises to participate, factors such as public interests, social benefits and risk sharing should be fully considered to ensure the sustainable development and fair competition of the project.
In general, giving priority to the participation of private enterprises in the new mechanism of public-private partnership is an important measure to promote market-oriented reform and promote economic development, which will help stimulate the vitality of private enterprises and improve the efficiency and quality of project construction. However, in the process of implementation, it is necessary to pay attention to balancing economic interests and public interests, and establish a sound regulatory mechanism to ensure the sustainable development and fair competition of the project.