A starting guide to public-private partnerships
What is a PPP?
A public-private partnership, or PPP, is a long contract in which a government and a company build and run a public service together. This guide starts from zero and ends with what PPPs could do for Jordan.
IWhat a PPP is
A PPP is a long contract to build and run a public service
A government and a company agree, for 20 years or more, to deliver something the public needs. The company is paid when the service works.
“A long-term contract between a private party and a government entity, for providing a public asset or service, in which the private party bears significant risk and management responsibility, and remuneration is linked to performance.”
In plain words, the government decides what the country needs, such as a road, a water plant or a school. A private company designs it, builds it, often pays for it, and then runs it for many years, usually 20 to 30. The company is paid only when the service works as promised. At the end of the contract, the asset goes back to the government.
Partner 1
The government
Decides what the country needs, sets the standards the service must meet and checks that it does. The public asset stays public.
Partner 2
The private partner
Designs, builds, finances, runs and maintains the asset, and takes the risks it can manage best, such as building on time and on budget.
Partner 3
The public
Uses the service. In some PPPs people pay a fee for it, such as a road toll, a ticket or a water bill.
IIHow a PPP works
From an idea to the day the asset is handed back
Every PPP follows the same path. The first four steps can take years. The last three last for decades.
Seven steps, one path
- 1
Identify
The government picks a need, such as a water plant, and checks that a PPP is the best way to meet it.
- 2
Prepare
Advisors study the cost, the demand and the risks, and draft the contract.
- 3
Tender
Companies compete. The best bid on price and quality wins.
- 4
Sign and close
The contract is signed and the lenders commit the money. This moment is called financial close.
- 5
Build
The partner builds the asset and pays for delays and cost overruns itself.
- 6
Operate
For 20 to 30 years the partner runs and maintains the asset and is paid for performance.
- 7
Hand back
At the end of the contract the asset returns to the government in good working order.
The main kinds of PPP
BOT
Build, Operate, Transfer
The partner builds the asset, runs it for a fixed term, then transfers it to the government.
Example: Disi water conveyance, As-Samra
DBFO
Design, Build, Finance, Operate
The partner also designs the asset and raises the money to build it. Common for roads, hospitals and schools.
Example: The UK’s PFI hospitals and schools
Concession
Run an existing service
The partner takes over a public service, invests in it and collects fees from its users for an agreed term.
Example: Queen Alia International Airport
IPP
Independent power project
The partner builds a power plant and sells its electricity to a state buyer under a long power purchase agreement.
Example: Amman East, Tafila Wind, Shams Ma’an
How the private partner gets paid
A
User fees
People pay to use the service, through tolls, tickets or tariffs. The partner carries the risk that fewer people come than expected.
B
Availability payments
The government pays a regular fee as long as the asset is open and meets the standards. Payments drop when it falls short.
IIIA short history
Governments have worked with private builders for centuries
In the 1800s, many canals and railways were built by private companies under rights granted by governments. The modern PPP took shape in the UK in the 1990s and spread around the world.
1854
Egypt grants Ferdinand de Lesseps the concession to build the Suez Canal. A second concession in 1856 sets a 99-year term.
Source: US Department of State, Foreign Relations of the United States
1869
The Suez Canal opens on November 17, 1869.
1989
The UK Treasury allows private finance for new roads.
1992
The UK names its program the Private Finance Initiative (PFI). More than 700 PFI and PF2 deals follow, worth about £60 billion.
2004
A World Bank study of more than 1,000 concessions in Latin America finds that 30% were renegotiated.
Source: J. Luis Guasch, Granting and Renegotiating Infrastructure Concessions (World Bank, 2004)
2014
Australia’s Asset Recycling Initiative pays states 15% of the value of public assets they lease or sell when they reinvest the money in new infrastructure.
2018
On October 29, 2018, the UK stops using PFI and PF2 for new projects. Existing contracts continue.
2024
Private investment in infrastructure in low- and middle-income countries reaches $100.7 billion, up 16% on 2023.
Source: World Bank Private Participation in Infrastructure database
IVPPPs today
The world needs more infrastructure than governments can pay for
Budgets are tight and debts are high, so governments turn to private money and skills. Renewable power leads private investment in energy, and data centers are the fastest-growing new kind of project.
$100.7 billion
of private investment in infrastructure in low- and middle-income countries in 2024
Source: World Bank Private Participation in Infrastructure database
$9.2 billion
into 18 data center projects in 2024, about three times the level before
VWhat goes wrong
Where PPPs fail, and what the failures teach
A PPP works when each risk sits with the partner best able to manage it and the contract is priced fairly. Most failures start when one of those two breaks.
01
Contracts get renegotiated
Of more than 1,000 concessions in Latin America from 1985 to 2000, 30% were renegotiated, including 55% in transport and 74% in water, on average just 2.2 years after award.
Source: J. Luis Guasch, Granting and Renegotiating Infrastructure Concessions (World Bank, 2004)
02
Private money costs more
The UK’s National Audit Office found that private finance cost 2% to 4% a year more than government borrowing, and that one group of schools cost about 40% more than public financing.
03
Hidden bills for the state
Guarantees a government gives today can turn into payments years later. The IMF and the World Bank built a tool, PFRAM, to measure these costs before a contract is signed.
04
Contracts are hard to change
A contract signed for 25 years has to survive new technology, new needs and new governments. The National Audit Office reported that PFI contracts were rigid to run.
05
Long bills into the future
In 2018 the UK still owed £199 billion in PFI and PF2 charges, stretching into the 2040s.
06
Slow to prepare
Studies, approvals and tenders can take years before a large PPP breaks ground, so costs move and support can fade along the way.
VIThe future
PPPs are becoming faster, smaller and open to more people
Countries now recycle old assets to pay for new ones, and private money is flowing into new kinds of infrastructure such as data centers. AI, robotics and tokenization are changing how PPPs are prepared, built and owned, and together they point towards the $500 trillion infrastructure singularity.
VIIJordan’s PPP story
Jordan has built with PPPs for more than 20 years
Water, power and the main airport were all built or run through PPPs, and Jordan has passed three PPP laws, each one to make the next projects easier.
2003
The As-Samra wastewater plant reaches financial close on December 10, 2003: a 25-year BOT by a group led by Suez, worth about $169.5 million.
2007
Airport International Group signs a 25-year concession for Queen Alia International Airport on November 15, 2007, with IFC as advisor.
2009
Amman East, Jordan’s first independent power plant, opens on October 26, 2009: 370 MW, built by AES and Mitsui.
2013
The Disi water conveyance opens in July 2013, a 25-year BOT by GAMA that carries 100 million m³ of water a year to Amman.
2013
The $205.3 million As-Samra expansion, backed by MIGA guarantees, starts lifting the plant from 267,000 to 365,000 m³ a day.
2014
PPP Law No. 31 of 2014 sets up a PPP Unit at the Ministry of Finance and a PPP Council chaired by the Prime Minister.
2014
The 240 MW Al Manakher power plant, built by AES and Mitsui, starts up in July 2014.
2015
The 117 MW Tafila Wind Farm, 38 turbines worth about $287 million, starts generating.
2016
Shams Ma’an, 52.5 MW of solar, starts selling power to NEPCO under a 20-year agreement.
2019
A Cabinet decision moves the PPP Unit to the Prime Ministry.
2020
PPP Law No. 17 of 2020 replaces the 2014 law.
2022
The Economic Modernisation Vision sets Jordan’s course to 2033 in three phases and calls for more public-private partnerships.
2023
PPP Law No. 19 of 2023 takes effect on November 13, 2023 and strengthens the PPP Unit at the Ministry of Investment. PPP Regulation No. 9 of 2024 follows in March 2024.
2025
A group led by Meridiam and Suez signs the BOT contract for the Aqaba-Amman Water Desalination and Conveyance project on January 12, 2025.
2026
The final agreement for the National Water Carrier is signed on April 21, 2026: about $4.3 billion to build, 300 million m³ of water a year through a 450 km pipeline, with water planned for 2030.
VIIIJordan’s potential
Jordan’s next chapter could be its biggest
Jordan has a modern PPP law, a PPP Unit at the Ministry of Investment and two decades of projects behind it. The Economic Modernisation Vision asks the private sector to carry most of the investment to 2033. The next step is many more PPPs, of every size, led by every kind of organization.
$86 billion
of PPP and infrastructure projects in development in Jordan
$46 billion
of them anchored in Aqaba, Jordan’s only port
JD 41 billion
of investment the Economic Modernisation Vision needs by 2033, 72% of it private
2.6 million
jobs the Vision aims for by 2033, up from 1.6 million
IXThe 52 guides
52 free guides to launch a PPP program of your own
This page explains PPPs. The 52 guides show each kind of organization in Jordan how to take part: a mandate, a named team, a map of the projects it can join, its own offer, partners and a first pilot.
What every guide holds
01
Why it matters
Why this kind of organization belongs in Jordan’s PPPs, and what it brings that no one else can.
02
The program
A mandate, a named team, a map of the projects to join, its own offer, partners and a first pilot.
03
Jordan and Aqaba
Where the $86 billion of projects sit, and the share anchored in Aqaba.
04
AI, robotics and tokenization
What each technology changes for the organization and its projects.
05
Small PPPs, labs and unsolicited proposals
How to start small, test ideas in a PPP lab and bring a project to the government before it asks.
06
Six steps to start
The first moves, in order, from the mandate to the pilot.
One guide for every kind of organization
Open the library
05
Advisors and professional bodiesThe lawyers, financial advisors and chambers that structure and support each deal.
07
Technology and knowledgeThe technology companies, universities and schools behind AI, robotics and tokenization.
08
Economic sectorsCompanies in fourteen sectors of Jordan’s economy, from energy and water to tourism and sport.
- Energy Developers
- Oil and Gas Companies
- Water Companies
- Transport Companies
- Agriculture and Food Companies
- Mining Companies
- Manufacturing Companies
- Pharmaceutical and Life Sciences Companies
- Tourism and Hospitality Companies
- Education Companies
- Circular Economy Companies
- Green Economy Companies
- Creative Industries Companies
- Sports and Entertainment Companies
09
Humanitarian and reliefThe UN agencies, donors, charities, host communities and social enterprises that serve people in need.
XKey words
The words you will hear most
Thirteen terms that come up in every PPP conversation, in plain words.
- PPP
- A long contract in which a private partner builds or runs a public asset or service and is paid for its performance.
- Project company
- A company set up only to carry out one PPP. It signs the contract, borrows the money and owns the project’s rights. Also called an SPV.
- Concession
- The right to run a public service for a fixed term and charge its users.
- BOT
- Build, Operate, Transfer: build the asset, run it for a fixed term, then hand it to the government.
- DBFO
- Design, Build, Finance, Operate: the partner also designs the asset and raises the money.
- IPP
- Independent power project: a private power plant that sells its electricity to a state buyer.
- PPA
- Power purchase agreement: the long contract under which an IPP sells its power.
- Availability payment
- A regular fee the government pays while the asset is open and meets the standards.
- Financial close
- The day the contract is signed and the lenders commit the money, so building can start.
- Value for money
- The test of whether a PPP gives the public a better deal than the government doing the project itself.
- Contingent liability
- A cost the government may have to pay later if something goes wrong, such as a guarantee being called.
- Unsolicited proposal
- A PPP idea that a company brings to the government before the government asks for it.
- Small PPP
- A PPP small enough to prepare and sign in months, so many can run side by side.
Questions
Questions about PPPs
- What is a PPP?
- A public-private partnership (PPP) is a long-term contract between a private party and a government entity, for providing a public asset or service, in which the private party bears significant risk and management responsibility, and is paid according to its performance. This is the World Bank’s definition.
- How is a PPP different from privatization?
- In a privatization the government sells an asset for good. In a PPP the government keeps the asset public, the private partner builds or runs it for a fixed term, usually 20 to 30 years, and the asset returns to the government at the end.
- How does the private partner get paid in a PPP?
- Either through fees from the people who use the service, such as tolls and tariffs, or through availability payments from the government, which are paid while the asset is open and meets its standards.
- Does Jordan have a PPP law?
- Yes. PPP Law No. 19 of 2023 took effect on November 13, 2023, and PPP Regulation No. 9 of 2024 followed in March 2024. The PPP Unit sits at the Ministry of Investment. Earlier laws were Law No. 31 of 2014 and Law No. 17 of 2020.
- What are Jordan’s best-known PPPs?
- The As-Samra wastewater plant (2003), the Queen Alia International Airport concession (2007), the Amman East power plant (2009), the Disi water conveyance (2013), the Tafila Wind Farm (2015), Shams Ma’an solar (2016) and the Aqaba-Amman Water Desalination and Conveyance project, whose final agreement was signed in April 2026.
- How big is Jordan’s PPP opportunity?
- Jordan has about $86 billion of PPP and infrastructure projects in development, $46 billion of them anchored in Aqaba. The Economic Modernisation Vision needs about JD 41 billion of investment by 2033, 72% of it from the private sector.
Your next step
Now launch a PPP program of your own
Keep this guide as a PDF, then find the one of 52 free guides written for your organization.