Risk Matrix and PPP Contract Standardization, Best Practice, and Gap Analysis in Brazil

Public-private partnerships (PPPs) have been used to address the need for the implementation of huge investment programs and to bridge the infrastructure gap that exists in Latin American and Caribbean (LAC) countries. As is explained throughout this paper, under certain circumstances, PPPs represent an important tool to help governments implement their investment programs, thereby benefiting not only from private investment (which often includes foreign investment) but also from the various advantages that are typically associated with the PPP model. However, the need to secure financing for investment needs, especially in a situation of scarce public resources and fiscal constraints, should not be the only reason for choosing the PPP model. The objective of this paper is to highlight that the PPP model can be a valuable tool for undertaking public projects in an efficient and innovative manner and that it can provide more efficient and innovative public services in certain circumstances as well. In addition, when correctly used, it can generate public savings and create the fiscal space that LAC countries need to carry out their investments.