The power of public-private partnership

Dalian, a leading example of China's emerging cities, is undergoing a high rate of economic growth (16.5 percent in 2006), creating strong demand for public facilities and services.

It's one of the five cities in China with the highest concentration of overseas representation and has 84 of the Fortune Global 500 companies and more than 8,000 foreign enterprises invested in the city.

A recent World Bank report on the investment environment in 120 cities in China based on the results of a survey of 12,400 foreign and domestic companies indicated Dalian in many respects is a leader in the quality of investment climate.

There is clearly an emergence of a wide range of government-industry collaboration in China, with Dalian as one of the cities leading in this effort. We can find many successful examples of government-industry partnership across a range of industry sectors in Dalian.

In June alone, four industry-research strategic alliances were set up with government support. The alliances include 26 leading enterprises, 18 leading universities and nine key research institutions.

Public-private partnership brings value to the growth of emerging cities contributing to the long-term sustainable development of China. It addresses important commercial and social needs demonstrating how the public and private sectors can work together to create ideal conditions for economic growth.

For example, many governments are turning to private-sector entities for construction or maintenance of critical infrastructure like roads, ports, schools and hospitals. Major capital-market firms have raised multibillion-dollar investment funds to undertake infrastructure projects, in which management expertise and financial resources from the private sector are deployed to meet crucial public-sector needs.

The public sector, in the meantime, gains an increased capacity to focus on its core mandate of ensuring an acceptable quality of life for its citizens by efficiently and imaginatively leveraging the full spectrum of available resources.

While focusing on the infrastructural, technological, and environmental development of the cities, the art and cultural aspect of society cannot be ignored, as agreed by the participants at the 33rd China Daily CEO Roundtable. They are equally important to the daily life of the citizens and help boost the vibrancy and attraction of the city.

Also, a World Bank report recommends that more development is required in many cities on education and health and more investment is needed in innovation, urban infrastructure and services, areas that lend themselves to potential partnerships between government and industry.

At the 33rd Roundtable on the topic, Jerry Leamon, global managing partner of services, Deloitte, said there are three key ingredients in public-private partnership success.

These include an environment that attracts and nurtures entrepreneurs and talent, the availability of capital to fund growth and innovation, and the positive actions to work together on part of both the public and the private sectors.

Leamon said: "We are very optimistic about China's prospects for continuing its remarkable record of economic growth. I am confident the proper triangulation of government, capital markets, and entrepreneurial innovation will play a key role in bringing this about."

The author is CEO of Deloitte China

(China Daily 09/14/2007 page15)