Government has a key role in the creation and maintenance of a strong enabling economic environment. It is inefficient for government to manage assets that could be more productive in the private sector.
The key arguments for private sector participation are improved efficiency and better allocation of scarce resources. The main results are unblocked supply chains and reduced unemployment in companies. Creating active markets and reducing transaction costs drives increases in incomes and buying power.
Most studies show a negative correlation between economic development and government ownership and management of productive assets in the industrial and financial sectors.
Private Sector Participation (PSP) Strategies include both economy-wide strategies and single-industry strategies. They work with governments to identify key industries that would benefit from PSP, to establish how the industries should be organised, and to determine what the impact on the population w