The World Bank's Private Participation in Infrastructure (PPI) Database records contractual arrangements with and without investments in which private parties assume operating risks in low- and middle-income countries.18 The Database covers infrastructure projects that meet three criteria:
◼ Projects that are owned or managed by private companies in low- and middle-income countries. Private parties have at least a 25% participation in the project contract, except for divestitures, which are included with at least 5% of equity owned by private parties.
◼ Projects that directly or indirectly serve the public -- captive facilities (such as cogeneration power plants and private telecommunications networks) are excluded unless a significant share of output (20%) is sold to serve the public under a contract with a utility.
◼ Projects that reached financial closure after 1983 (database coverage currently extends to 2012).
Projects are considered to have private participation if a private company or investor bears a share of the project's operating risk. That is, a private sponsor is at least partially responsible for operating cost and associated risks. This could be by either having the rights to operate alone or in association with a public entity or owning an equity share in the project. The Database classifies private infrastructure projects in four categories:
| Concessions (or management and operation contracts with major private capital commitments) ◼ Build, rehabilitate, operate and transfer ◼ Full ◼ Rehabilitate, lease or rent, and transfer ◼ Rehabilitate, operate, and transfer | Greenfield projects ◼ Build, lease and transfer ◼ Build, operate and transfer ◼ Build, own and operate ◼ Merchant ◼ Rental |
| Management and lease contracts ◼ Lease contract ◼ Management contract | Divestitures ◼ Full ◼ Partial |
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18 However, figures on PPPs should be treated with caution as different definitions of PPP result in confusing reporting practices. Therefore, figures should be read as a useful indication of global trends and not as a basis for an extensive quantitative analysis.