Activating Partnership Contracts between the Public and Private Sectors as a Mechanism to Stimulate Investment: A Comparative Study

Prof. Allal Al Fali
Professor, Faculty of Legal,
Economic and Social Sciences, Agdal
Mohammed V University, Rabat, Morocco


The relationship between the public and private sectors passed through three basic stages. The first started with waves of privatization that affected many sectors, activities, and public institutions, according to which the ownership of the latter was transferred permanently to the private sector. Then the second was characterized by mitigating the severity of privatization by resorting mainly to concession contracts, mixed economy companies and delegated management contracts, while the third stage began with the emergence of so-called partnership contracts between the public and private sectors aimed at providing services and economic, social and administrative infrastructure of quality at the lowest cost and developing models of good governance of public utilities within public administrations. That is why many Arab and foreign countries have organized this type of contract under special legal texts, including Moroccan, Kuwaiti, Jordanian, Egyptian and French legislation.
In view of the peculiarities and advantages that frame this mechanism of cooperation between the public and private sectors, it is possible to question, on the one hand, the most important legal, economic, financial and social advantages or incentives that the mechanism provides which would encourage the private sector to conclude partnership contracts with persons of public law, and thus invest in many of the vital and important areas in the country. On the other hand, there are questions about some of the flaws, or shortcomings in the legal regulation of this mechanism, whether in Kuwait, in Morocco, or in other Arab and foreign legislation, which still makes many private partners reluctance to resort to this kind of long and risky investment.
Thus, this research attempts to answer these questions by first addressing the role of some of the specifics of the partnership contracts between the public and private sectors in encouraging investment, and secondly addressing some of the influences that limit the effectiveness of this mechanism. The paper also proposes some recommendations and solutions for this issue.

Key words: privatization, concession contracts, mixed economy, delegated management contracts, investment promotion.

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