The Asian Development Bank is firmly committed to continue its support of private-public partnerships, President Benigno Aquino’s flagship initiative for infrastructure development in the Philippines.
Australia, Canada and ADB last week announced that they would be providing an additional $18 million to these projects through the Philippine Public-Private Partnership Center and the Project Development and Monitoring Facility, which finances project preparation costs to ensure the feasibility of projects. Both entities are currently overseeing 25 proposals with total estimated investments with more than $4.2 billion.
The latest contributions increase to over $22 million the amount available for capacity building and institutional strengthening so at least 15 PPPs may be implemented or ready by 2016, up from the original target of five projects by the end of 2013 in a country where basic infrastructure badly needs an upgrading.
But so far only two tollways and an education project have been successfully bid out, so why is ADB still banking on this idea and what are the institution’s future plans on this? We asked Aziz Haydarov, PPP specialist at the bank’s Southeast Asia Department.
Does ADB have plans to tap other donors for this project?
ADB is actively involved in development partner coordination platforms to support various areas of Philippine development, including improving infrastructure through fostering PPPs. This coordination occurs at country program level as well as in specific projects. In the area of PPPs, ADB has closely coordinated and cooperated, under the leadership of the government … with the World Bank, IFC, JICA, AusAID and Canada in strengthening PPP enabling environment. As the country now moves to the next phase in PPP program and reforms, ADB will continue to coordinate with the multilateral and bilateral development partners to pro-actively respond to the emerging capacity and institutional strengthening and project finance needs to sustain the positive momentum in PPP reforms.
Why did ADB ask for funding from AusAID and Canada?
AusAID and Canada have joined ADB efforts in strengthening the capacity and systems of the government … in transparently managing PPPs to enable more private investment in infrastructure in line with the country’s development plans and public investment program.
Is supporting PPP programs or policy of recipient countries a new focus/strategy of ADB? If so, why?
Overall, under ADB’s Strategy 2020, the PPPs are one of the major modalities to help improve infrastructure - one of the core areas of operations — through private finance. At the country level, support to PPPs is one of the areas under the ADB-Philippine country partnership strategy for 2011-2016, which is fully aligned with the Philippine Development Plan for 2010-2016 indicating that the government will rely on PPPs to implement the bulk of its infrastructure program.
What is the role of donor countries and international financial institutions like ADB in the age of PPPs?
PPPs are just another — though relatively young — modality to create or maintain public infrastructure. Given their role as supporters of the countries’ public investments, the IFIs will be increasingly involved in PPPs which have become in many countries a regular way of public infrastructure delivery (along with government- or ODA-funded projects). … The role of ADB (and most likely of other IFIs) will be in four areas: advocacy and capacity development, enabling environment, project development, and project financing.
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About the author
John Alliage Morales
As a former Devex staff writer, John Alliage Morales covered the Americas, focusing on the world's top donor hub, Washington, and its aid community. Prior to joining Devex, John worked for a variety of news outlets including GMA, the Philippine TV network, where he conducted interviews, analyzed data, and produced in-depth stories on development and other topics.
