Hybrid PPPs: Turning risk into viability
Hybrid Public-Private Partnerships (PPPs) address a key infrastructure challenge: when financially sound projects remain unbankable due to viability gaps—where projected revenues fall short of costs. Even well-prepared PPPs can stall without investor confidence, particularly during high-risk construction phases.
Hybrid PPPs combine traditional PPP structures with concessional financing or Viability Gap Funding (VGF) to bridge these financial gaps, making projects both bankable and affordable. This approach enables governments with limited budgets to attract private capital for essential infrastructure.
The World Bank Group’s “One World Bank” model integrates financing and advisory services to ensure projects meet international standards and deliver long-term impact. Unlike standard PPPs, Hybrid PPPs incorporate a third element—blended finance—to enhance viability. They represent a practical solution to delivering sustainable infrastructure in complex economic contexts, advancing the Sustainable Development Goals (SDGs) by transforming policy intent into real-world outcomes.
