Abstract
Infrastructure development in Southeast Asia has been financed mainly by public funds, which leave wide gaps in majority of countries. Governments have tried to attract the private sector by offering various schemes under public–private partnership (PPP). Typically, PPP contributes less than 1% of gross domestic product, while public finance greatly varies from about 2% to 10% of a country’s gross domestic product. Among major factors supporting PPP implementation, the following features are critical: coherent policy, public sector capacity to manage PPP appropriately, public sector willingness to have mutual relation with private partners, and leadership. Private participation is still continuously growing; and its implementation is not limited to hard infrastructure only, but also to social infrastructure.
Highlights
Infrastructure is fundamental to support economic growth and human well-being
Using a sample of advanced economies, the International Monetary Fund estimates that an increase of 1% in investment spending raises gross domestic product (GDP) by approximately 0.4% in the same year and by 1.5% in 4 years after the increase (IMF 2014)
This paper attempts to provide the landscape of infrastructure development in majority of the Association of Southeast Asian Nations (ASEAN) member states with emphasis on financing mechanism, in which private partnership (PPP) is promoted as strong complement of limited public funds
Summary
Infrastructure is fundamental to support economic growth and human well-being. It provides goods and services for direct use as well as supports other socioeconomic activities. The public–private partnership (PPP) allows the private sector to utilize its competence and innovative resources; and, at the same time, to gain fair benefits from it. This paper attempts to provide the landscape of infrastructure development in majority of the Association of Southeast Asian Nations (ASEAN) member states with emphasis on financing mechanism, in which PPP is promoted as strong complement of limited public funds. It discusses the “infrastructure ecosystem,” and the potential to use PPP in social infrastructure and pro-poor development planning
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