Business Desk :
Countries in Asia and the Pacific with developed financial markets, strong local financial institutions, and diverse financing resources are more likely to secure public-private partnership (PPP) projects, according to a new Asian Development Bank (ADB) report released on Thursday.
The Public-Private Partnership Monitor tracks the development of the PPP business environment across ADB member countries and provides insights for governments on structuring a sound environment for PPPs.
This is the first edition of the report, which surveyed 9 countries in the region: Bangladesh, China, India, Indonesia, Kazakhstan, Papua New Guinea, the Philippines, Thailand and Viet Nam. It will be expanded to include additional countries in subsequent annual editions.
The report aims to benefit both policymakers and investors by providing in-depth information and data on the business environment for PPPs over time, enabling infrastructure developers to assess opportunities across countries and sectors. Annual updates to the report will flag important reforms that could attract or deter investors, allowing policy makers to monitor progress in the PPP environment.
“PPPs are crucial contributors to the development of countries in the Asia and Pacific region, but an enabling environment is required for these projects to succeed,” said ADB President Takehiko Nakao. “This report will help both policymakers and investors make informed decisions, better manage risk, and ensure a more stable environment for PPPs,” Takehiko Nakao added.
The report reveals that India, the Philippines and Thailand have the most developed financial markets, which can provide longer-tenor loans (above 10 years) in local currency to support infrastructure. These markets also have a wide array of financing options including project bond financing.
The report finds that the PRC has the most PPP projects that reach financial close. But there is scope to scale up PPPs in the country by drawing on more private sector companies.
Among the key trends identified in this year’s report is that energy generation is one of the most successful sectors in developing PPP frameworks. Thermal and renewable powers are the dominant sectors for the majority of the countries surveyed in the PPP Monitor. The water sector is also a major area for PPP investment, with over 40 percent of PPP projects in the PRC in this sector.
