sustainability Article Major Obstacles to Public-Private Partnership (PPP)-Financed Infrastructure Development in China Toriqul Bashar 1, * , Ivan W. H. Fung 2 , Lara Celine Jaillon 2 and Di Wang 2   Citation: Bashar, T.; Fung, I.W.H.; Jaillon, L.C.; Wang, D. Major Obstacles to Public-Private Partnership (PPP)-Financed Infrastructure Development in China. Sustainability 2021, 13, 6718. https:// doi.org/10.3390/su13126718 Academic Editor: Donato Morea Received: 26 April 2021 Accepted: 9 June 2021 Published: 14 June 2021 Publisher’s Note: MDPI stays neutral with regard to jurisdictional claims in published maps and institutional affil- iations. Copyright: © 2021 by the authors. Licensee MDPI, Basel, Switzerland. This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license (https:// creativecommons.org/licenses/by/ 4.0/). 1 Institute for Social Policy, Housing and Equalities Research, Heriot-Watt University, Edinburgh EH14 4AS, UK 2 Department of Architecture and Civil Engineering, City University of Hong Kong, Hong Kong, China; ivan.fung@cityu.edu.hk (I.W.H.F.); lara.jaillon@gmail.com (L.C.J.); wangd@jumbocn.com (D.W.) * Correspondence: bashar.inm.bd@gmail.com; Tel.: +44-(0)131-451-4605 Abstract: Public-private partnership (PPP)-led infrastructure development has been crucial in China as it has in many other countries. However, several obstacles in the field tend to challenge its development. Based on survey responses from PPP practitioners and professionals in Hong Kong and mainland China, this study analyzes and ranks the key barriers to PPP projects. Our findings suggest that both groups classify the critical obstacles to PPP consistently, albeit with some divergences in ranking them. Reflecting mainly from the perspective of professionals, the study also proposes some suggestions for mitigating these obstacles, so it could contribute to the effective formulation of PPP and successful implementation of PPP-led infrastructure projects in China as well as elsewhere. Keywords: PPP; obstacles; project failure; infrastructure; sustainable development; China 1. Introduction Public-private partnerships (PPPs) have become popular with the advancement of project financing mechanisms. The British government was the first to use the term in 1982, defining it as an agreement between the government and private enterprise on infrastructure finance, operation and management. In general terms, a PPP is an alternative finance method aimed at overcoming the limitations of the public sector, as well as a way of enhancing efficiency in construction, operation and service delivery [1,2]. This definition implies three main features—partnership, benefit sharing and risk sharing—to reduce the financial burden and other risks to the public sector through different models such as build, operate and transfer (BOT), build, transfer and operate (BTO), build, own and operate (BOO) and design, build, finance and operate (DBFO). These models are efficient in different ways in sustainable infrastructure development. Each one also incorporates an element to realize sustainable social change [3]. However, each model’s effectiveness is also affected by the various obstacles that are encountered in practice [4,5]. The absence of clear contractual arrangements, resulting in weak governance, is one of many factors contributing to the failure of PPP projects [6]. PPPs have received a great deal of attention in research across academic disciplines, and academics have studied them from many different perspectives. Scholars have looked at the various obstacles to PPPs using their respective disciplinary perspectives, from financial risk assessment to construction project management [7,8]. A large part of the literature has focused on the financial risks arising from having weak contractual arrange- ments between stakeholders, including the uncertainty of long-term concessional periods which generate high risks for both government and private enterprises. This implies that a project’s success is thus heavily dependent on having the right contractual arrangements in place and allocating risks in line with resources, institutional frameworks and use of institutional rules [6,9,10]. The literature has investigated these contractual arrangements and risks extensively, however, it is not well known how important these major obstacles are, so an investigation into them and their level of importance is needed. Written from the Sustainability 2021, 13, 6718. https://doi.org/10.3390/su13126718 https://www.mdpi.com/journal/sustainability