Philippines: PPP still vital in infra push: ADB – 29 Jul

  • The size and extent of the government’s infrastructure development program in the medium term will still require the active use of the public-private partnership (PPP) scheme, the Asian Development Bank (ADB) said.
  • In a recently-published paper titled “Scaling Up Infrastructure Investment In The Philippines: Role of Public-Private Partnership and Issues,” the multilateral development bank said the country already has a developed PPP mechanism that only needs to be in sync with short term and medium term infrastructure investment plans.
  • ADB places the country’s current public capital stock – economic and social infrastructure – at only 35% of gross domestic product (GDP), noting this is “less than half” of the average in ASEAN.
  • To speed up the implementation of big-ticket infrastructure projects, the administration currently prefers to build the hard infrastructure through the use of official development assistance (ODA) funds and loans from multilateral development banks and later on bid out the operations and maintenance to the public sector.
  • It is, however, promoting the use of PPP in infrastructure development in local government units. But ADB said the PPP route is still a viable means of pursuing key projects as the Philippine government has been able to steadily strengthen the framework for PPP project preparation and approval.
  • The case against PPP has always been the substantial amount of time it entails – an average of 29 months – to move a project from planning to implementation. ADB said PPP could be effectively used within the medium term public investment framework by prioritizing projects that fit the goals within the time period.

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