Regulatory and institutional reforms are needed to make infrastructure more attractive to private investors and generate a pipeline of bankable projects for public–private partnerships. Photo: ADB.
Mekong governments need to create an enabling environment for public-private partnerships in infrastructure. Here are 4 ways to get the job done.
In a blog post, Pratish Halady of the Asian Development Bank shares four takeaways from the Greater Mekong Subregion (GMS) Economic Corridors Forum in Ha Noi, Viet Nam in September 2017, where the potential for public–private partnerships (PPPs) to bring private investment to infrastructure projects where discussed. These are:
- The need for infrastructure financing is significant.
- The private sector alone cannot plug the infrastructure financing gap.
- Official development assistance (ODA) can be a catalyst to crowd in private finance.
- Agencies must coordinate and commit for projects of national importance.
Halady says the consensus at the forum was that governments need to commit and coordinate to create an enabling environment for PPPs. He notes that the GMS Regional Investment Framework 2022, endorsed by the GMS Ministers in September, provides a starting point for selecting infrastructure projects for possible partnerships with the private sector.
"The next step is to assess the bankability of these projects. Bankable, commercially viable projects can be considered for private sector investment, while bankable but non-commercially viable projects can be unlocked/accelerated through a blend of ODA and PPP structuring," Halady says.
Read the full article published on 27 November 2017 at the Asian Development Blog.