The risk was transferred. The guarantee is paid every year.
Türkiye has signed 277 PPPs since 1996, worth 6.7% of GDP in contract value. Their risks and rewards, the IMF’s fiscal transparency update notes, are transferred to project companies outside government. Except one: minimum revenue guarantees, which “are frequently called, particularly for the transport sector”.
There is no cap on total PPP exposure. Annual payments over the life of the contracts are not published, and guarantee exposure is not disclosed by sector or project. The IMF rates PPP disclosure “Basic, unchanged from 2015”.
€2.9 billion of claims the budget doesn’t price. One just became a bill.
Portugal’s parliamentary budget office counts €2,869m of contingent liabilities from PPPs at end-2025: rebalancing, compensation and indemnity claims by private partners. It is the highest since the series began — €891m in 2020. The fiscal council notes the 2027 budget does not factor in the outcome of the negotiations under way.
The budget office is careful: these are claims, not recognised charges. But their realisation, “in whole or in part, would weigh on the budget balance of future years”. One already has.
Cap the guarantees before you sign the first PPP.
Somalia is leaving debt relief behind and beginning to finance infrastructure “through debt and guarantees”. In the medium term it plans to issue guarantees or enter into PPPs to upgrade key infrastructure. Before signing any of them, its 2026 budget sets a limit.
The World Bank’s Public Finance Review spells out why: these guarantees and PPPs “could generate significant fiscal costs if revenues or demand fall short and the guarantee is called”.
Parliament votes the payments before the road is signed.
On 26 October the Czech government approved the D35 motorway PPP: two new sections built, financed, operated and maintained by a private consortium. The State starts paying for availability only once every new section is open — and pays less when the road falls short of the contract.
Under the road act, the Chamber must consent to “the figures expressing the State’s financial obligations to the concessionaire” before the contract is signed. The commitment is firm, and it is counted where it is decided.
A government guarantee triples the hazard of contract distress.
The guarantee is often what gets a PPP signed. An IMF economist’s study of PPP contracts in developing economies finds it also predicts the trouble: when the government issues a guarantee, the hazard of contract distress — disputes, renegotiation, cancellation — “increases by a factor of 3”.
The earlier IMF working paper, on about 6,000 contracts in 113 emerging and developing economies (1984–2015), pointed the same way. The risk is “most pronounced in developing countries at the bottom quintile of public investment management capacity”.
A contingent liability is a payment nobody has dated. Date it.
Türkiye pays its revenue guarantees every year. Portugal’s claims became a court order. Somalia capped its guarantees before the first contract; Czechia puts the payments to a vote before signature. And across developing economies, the guarantee is the clause that predicts distress. Contingent liabilities arrive. The only choice is whether the budget expected them.
Which of your guarantees is already being paid?