Public-Private Partnerships (PPPs)

In Lithuania, as in many countries of the world, the need to invest in high-quality public infrastructure and modern public services is steadily growing. In order to efficiently use the State or municipal resources and to accelerate the implementation of investment projects, various models of implementation of investment projects are used, one of which is public-private partnerships (PPPs).

PPPs are long-term public-private contractual cooperation where a private partner contributes to the creation, renovation, financing, maintenance or service provision of public infrastructure, and where the public sector ensures the public interest and the control of results.

When are PPPs the right solution?
The PPP model is most often used when:
•    significant infrastructure investments are needed; 
•    the long-term empowerment of the facility and the quality of maintenance of the facility are important; 
•    the project requires private sector expertise and innovation; 
•    a clear allocation of responsibilities and risks is possible; 
•    seeking for the best value for taxpayers during the entire duration of the project. 

Benefits of PPPs
Properly designed PPP projects can enable:
•    faster implementation of projects important to the public sector; 
•    a higher quality of infrastructure and services; 
•    more effective management of project risks; 
•    better planning of long-term costs; 
•    leveraging the private sector expertise and innovation; 
•    linking public sector payments to actual results. 

Important prerequisites for success
The success of PPP projects depends on:
•    a clearly justified public need; 
•    high-quality preparation for the implementation of the project; 
•    a competitive selection of the partner; 
•    a high-quality contract; 
•    professional and continuous project supervision; 
•    financial sustainability and transparency. 

Role of the Ministry of Finance
Since 2024, a new provision has entered into force in the Republic of Lithuania Law on Investment and Republic of Lithuania Law on Concessions – PPPs are integrated into the public finance management and control system and planned in accordance with the procedure laid down in the legislation governing the strategic management system. The Republic of Lithuania Law on Investment establishes the institutional framework for PPPs and their participants and their responsibilities. The Ministry of Finance, as a public policy-maker in the field of public financial management which organises, coordinates and monitors its implementation, is responsible for the preparation of draft legislation governing PPPs and performs other functions related to the implementation of PPPs prescribed by law. Following the integration of PPPs into the public financial management and control system, the main function of the Ministry of Finance – to draw conclusions on the impact of PPPs on public fiscal indicators – is also integrated into the requirements of the strategic management system.

Detailed information
More information about PPPs can be found on the website ppplietuva.lt.

If you have any questions, for more detailed information you can contact the public institution Central Project Management Agency – PPP Methodological and Advisory Assistance Competence Centre.