Generally, SWOT-analysis is used to estimate the internal strengths and weaknesses, and external opportunities and threats in a certain environment (Speth &
Probert, 2015). Using knowledge about the internal and external position, SWOT-analysis aims to develop an appropriate strategy for current and future potential (Sammut-Bonnici & Galea, 2015).
In the context of PPP, SWOT-analysis (figure 2) helps to identify the assets the partnership may be based on and weaknesses that need to be compensated through the partnership (Roumboutsos & Chiara, 2010:239). In other words, it helps to point out the feasibility of partnerships and their coincidence in the targets.
Thus, the analysis of the microeconomic environment is organizational functions (financial, managerial, marketing resources, etc.) and the analysis of the macroeconomic environment includes competitor environment (gathering information on resources, capabilities, core competencies, etc.), industry environment (e.g.: threat
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of new entrants, power of buyers, power of suppliers) and general environment (inc.:
political, economic, sociocultural, technological, ecological and regulatory perspectives) (Sammut-Bonnici & Galea, 2015).
Figure 1. SWOT-analysis of PPP
The main elements of SWOT-analysis are presented in figure 1 that causes the value of PPP for public sector, private sector and foremost for citizens and users.
I decided to use the SWOT analysis in my work to evaluate the PPP market in a certain country because it is a well-known strategic planning tool. Thus, I can study both the macroeconomic environment (opportunities and threats) and the microeconomic environment (strengths and weaknesses) in relation to partnerships using the SWOT analysis, and it is possible to predict the prospect of a positive or negative trend.
Many scientists who studied PPPs in well-developed countries (Engel et al., 2013; Chou & Pramudawardhani, 2015; Bishop & Waring, 2016; Hodge & Greve, 2017; Shaw, 2018) and in developing countries (Grimsey & Lewis, 2002; El-Gohary et al., 2006; Chou & Pramudawardhani, 2015; Appuhami & Perera, 2016; Kavishea &
Chileshe, 2018) concluded that the country's political and institutional climate has a direct impact on the effectiveness of PPPs, as well as on its strengths and weaknesses.
Therefore, there is a need to understand the basic components of PPP, including policy, legal framework, processes and institutional responsibilities, financial aspects and other actors (table 7) as well as their social understanding.
Strengths Weaknesses
Opportunities Threats
Public sector
Citizens
& users
Private sector
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Table 7. The components of the conceptual framework of PPP
Aspect
Name of
component
Explanation
Legislative
Policy the formulation of the rationale for the government's intention to use PPP for the provision of public services, as well as the goals, scope and principles for implementing the PPP program.
Legal framework
the laws and regulations underlying the PPP program — enable the government to join PPPs and set the rules and boundaries for how PPPs should be implemented. This may include legislation on PPPs, other laws and regulations for managing public finances or industry-specific laws and regulations.
Financial
Financial aspects
how financial commitments under PPPs are monitored, taken into account and accounted for in the budget to ensure that PPPs provide VfM without undue burden for future generations, and to manage the related fiscal risk.
Institutional
Processes and institutional responsibilities
the stages through which PPP projects are defined, developed, evaluated, implemented and managed, ideally, within the framework of the public investment management system; and the roles of various actors in this process. A reliable PPP process is efficient, transparent and consistently used to effectively control the quality of PPP projects.
Other actors the actors, such as auditing organizations and the public participate in the PPP program and make those responsible for implementing PPP accountable for their decisions and actions.
Source: OECD (2011:58).
In view of the above, I created a conceptual framework (figure 2) that includes five crucial components of PPP (policy, legal framework, processes and institutional responsibilities, financial aspects and other actors). Then, there is a number of risks arise from a particular country’s environment that affects PPP. So, it is important to distinguish them concerning PPP implementation and accession the feasibility of projects. It is sensible to separate the risks into internal and external risks, which implies the application of the SWOT-analysis. After I can reasonably evaluate the
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beneficial impact on the main stakeholders among them the public sector, private sector, citizens and users.
Figure 2. The conceptual framework of PPP
As far as many researchers in different contexts emphasize the importance of these components separately or in common, I consider that this is a comprehensive structure to consider PPP from different angles and understand its beneficial effects on the public sector, the private sector, the citizens and users (Grimsey & Lewis, 2002;
5 components
Policy Legal
framework
Risks
Internal
Strengths Weaknesses
PPP Implementation
Beneficial impact ON
Citizens &
users Public
sector
Private sector External
Opportunities Threats Financial
aspects
Processes and institutional responsibilities
Other actors
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El-Gohary et al., 2006; Engel et al., 2013; Chou & Pramudawardhani, 2015; Kavishea
& Chileshe, 2018; Shaw, 2018).
Based on this, I conduct my research in order to answer questions and reveal the essence of PPP, the key benefits of PPP and risks for both the public sector and the private sector in developing countries, using the example of Ukraine.
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RESEARCH METHODOLOGY
This research seeks to investigate peculiarities of spreading of PPPs in the context of a developing county, using example of Ukraine.
Having an understanding of a project’s research objectives or questions paves the way for other important decisions about the design and running of the project. This includes decisions about data collection and data analysis methods to use (Thomas &
Hodges, 2010).
This chapter demonstrates the research methods and data gathering techniques.
The qualitative analysis was employed for data collection and data analysis. The end of the chapter provides arguments of information validity and reliability.