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23INTERNATIONAL JOURNAL OF

PROJECT MANAGEMENT
International Journal of Project Management 24 (2006) 587–594 www.elsevier.com/locate/ijproman

Role of public private partnerships to manage risks in public sector projects in Hong Kong
Li-Yin Shen a a,*

, Andrew Platten b, X.P. Deng

c

Department of Building and Real Estate, The Hong Kong Polytechnic University, Hung Hom, Kowloon, Hong Kong b Elevate East Lancashire, Accrington, England, UK c School of Civil Engineering, South East University, PR China

Abstract The clients of public sector works have an obligation to ensure that the large scale investment in public works is effective and can achieve improvement in social and economic performance. However, construction activity is usually subject to more risk than other business activities because of its complexity particularly in coordinating a wide range of disparate and interrelated skills and activities. This complexity is further compounded in implementing public sector projects where multiple project objectives are expected by a wide range of stakeholders who have different interests associated with the projects. With reference to current practice in Hong Kong, this paper examines the major risks in implementing public sector works, and the ways that the application of public private partnership (PPP) can help to manage risks in project delivery. The example of Hong Kong Disneyland (KDLD) demonstrates how various major risks in committing to a PPP project are allocated and shared effectively between public and private partners. In this typical PPP project, it is found that allocation of site acquisition risk and legal and policy risks to the public sector is more effective while private sector could effectively allocate the design and construction risks, operation risks and industrial action risk to the private sector. Also, development risks,

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