The Asian Development Bank (ADB) and International Enterprise (IE) Singapore, a government agency that promotes Singapore’s growth overseas, have launched an initiative to help Southeast Asian countries develop their public-private partnership (PPP) frameworks, in the hopes of boosting private sector participation in ASEAN infrastructure.
Both ADB and IE Singapore have jointly committed $9 million over a period of three years. The initiative is currently looking at various ASEAN government projects to support, and sectors range from power generation to water management, to transport, according to an ADB statement.
The initiative is planning to begin operations in the second half of this year, and is now looking into projects alongside the pipeline development for the ASEAN Infrastructure Fund (AIF), an open-ended fund that provides loans to Southeast Asian infrastructure projects, according to Arjun Goswami, director of the Regional Cooperation and Operations Coordination Division in ADB's Southeast Asia Department.
Goswami added the ADB sees “an important synergy between this initiative and the AIF,” which now has an approximately $1 billion pipeline for the next three years.
With the ASEAN region’s infrastructure needs projected to be $60 billion per year over the next 10 years, a good PPP framework in each ASEAN country will require a significant amount of expertise, Goswami said.
“Often, PPP project preparation [by ASEAN governments] is inconsistent or inadequate because of resource and capacity constraints,” he told Infrastructure Investor. “This initiative aims to help address that constraint in a targeted manner and subsequently […] catalyse greater private sector participation and investment in ASEAN countries' infrastructure delivery.”
IE Singapore will bring in representatives from Singaporean corporations, who will oversee the initiative's projects jointly with ADB representatives, according to the statement. Singapore’s private sector development is far ahead of its ASEAN counterparts, and thus the initiative hopes to give the ASEAN region greater access to the small island’s resources needed for infrastructure.
“Singapore-based companies have an established track record implementing PPP projects in Singapore and overseas. Singapore also has a strong financial sector with comprehensive capabilities to support infrastructure financing,” Chua Taik Him, IE Singapore’s deputy chief executive, said in the statement.
Goswani added, however, that governments’ needed expertise could be source from local, regional or international sources, depending on the needs of a particular country’s PPP framework.