A PPP allows the transfer of certain project risks from the public to the private sector (see page 5). This enables the public sector to reduce its own risk and potential financial losses for a project. Further, allocating risk to the party best able to manage it makes it less likely that each project risk will materialize, thus reducing the overall project risk.41 The up-front consideration of risk in a PPP agreement may also facilitate less costly and more timely risk mitigation.42 Again, however, these potential benefits depend on careful project analysis, contracting, and public sector monitoring and enforcement of the PPP agreement.43