Public–private partnerships represent a new form of network governance, potentially offering flexibility, economic efficiencies and non-governmental participation in policy development. Such partnerships can be viewed in terms of sustainable development, achieving two of its three tenets – economic and social growth. Combining growth and participation has particular appeal in transition economies such as Hungary's, where both need stimulation. However, policy-making at the national level in Hungary inhibits participation. One key element of partnerships is trust. In transition economies such as Hungary, public- and private-sector actors have not had the time to develop the relationships necessary to create partnerships based on joint decision-making. Copyright © 2005 John Wiley & Sons, Ltd and ERP Environment.