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Philippine PPP ProgramSDG-6 (Water & Sanitation)
and SDG-11 (Sustainable Cities)
Regional Event on Financing SustainableInfrastructure Development in Asia and the Pacific
UNESCAP - Bangkok6-7 December 2017
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In 2014, the Economist Intelligence Unit Infrascope categorized the Philippines
as a “developed” PPP market in terms of “PPP readiness”, an improvement
from its previous grouping in the “emerging” PPP market category in 2011.
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Accelerated Infrastructure Development
PPP Program
Financing and Implementation
Delivery Mechanisms
Government/local funds
Government borrowings
PPP
v
Our Vision, Our Ambition
Philippine Development Plan 2017-2022
Chapter 19: Accelerating Strategic
Infrastructure Development
Encourage private sector participationCognizant of the private sector’s efficiency andinnovativeness, the government will improve its PPPProgram as a vehicle for private sector participationin financing where appropriate, the construction,operation and maintenance of infrastructureprojects.
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34PROJECTS
PHP 439 Billion
* Projects started from 2010 onwards (excluding terminated MPOC) and 2 projects developed before 2010 (MRT 7 and Skyway Stage 3)
as of Nov. 2017
AwardedPHP 311 Billion / USD 6.2 Billion* 15
Under ProcurementPHP 13 Billion / USD 0.26 Billion 1
3For Evaluation & Approval
Under Development
Under Review by Implementing AgenciesPHP 116 Billion / USD 2.3 Billion 4
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(USD 9 Billion)
PPP Projects
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Water and Sanitation in the Philippines*
92%of population has
access to improved water supply
US$ 838 million per yearinvestment requirement to achieve government targets for 2025 for water supply
74%of population has
access to improved sanitation facilities
US$ 619 million per yearinvestment requirement to achieve universal coverage by 2028
*Based on 2013 Joint Monitoring Programme (JMP) of the World Health Organization (WHO) and UNICEFhttps://www.wsp.org/sites/wsp.org/files/publications/WSP-Philippines-WSS-Turning-Finance-into-Service-for-the-Future.pdf
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Water and Sanitation in the Philippines*
Institutional framework• Integrated national planning structure
• Fragmented implementing agencies:o Metro Manila: national government corporation & 2 private concessionaireso Outside Metro Manila: local government units, water districts (formed as
local government corporations) and few private sector operators
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Philippine PPP Program and Projects contributing to SDG 6
PPP Program
✓ Formulation of PPP Water Code
✓ Enhanced strategy for assistance to local PPPs with water supply and sanitation as priority sectors (project development, capacity building, bundling strategy)
PPP Projects
Frameworkso Build-Operate-Transfer (BOT) variants pursuant to
existing law (BOT Law)o Joint Ventures (JV) with local water districts
pursuant to executive guidelines o JVs with local government units pursuant to their
local ordinances*These frameworks provide for solicited and unsolicited modes
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Source: World Bank
– Beyond One-
Size-Fits-All:
Lessons Learned
from Eight Water
Utility Public-Private
Partnerships in the
Philippines
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Bulacan Bulk Water Supply Project
Bulacan Province
• Located adjacent to the north of Metro Manila
• Main water service providers in the province are 24 water districts with ground water as their main source of water supply
Picture source: ADB
66%
33%
1%
Access to Water Supply (out of 500,000 households in Bulacan)
Piped water
Standalone waterpoints
Others
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Bulacan Bulk Water Supply Project
Supply issues• water supply deficit of approx. 90 million
liters per day
• low water pressure
• depleted groundwater aquifers
• saline water intrusion
Distribution problems• aging distribution pipelines
• high non-revenue water (average of 30%)
Increasing demand
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SCOPEProvision of treated bulk water to 24 water districtsFinancing, design, construction, operations and maintenance of:
• Raw water conveyance system and interconnection pipelines• Water treatment plants and ancillary facilities• Treated water reservoirs• Pumping stations
COST & REPAYMENTProject cost: PHP 24.4 Billion / USD 480 MillionRepayment: concessionaire to collect bulk water charges from water districtsBid parameter: lowest bulk water charge
IMPLEMENTATIONConcession period: 30 years + 2-year construction periodDelivery period: 3 stages in delivery of services to water districts
(fixed periods and demand-triggered)
Bulacan Bulk Water Supply Project
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Bulacan Bulk Water Supply Project
Reduced user feesWinning bid for bulk water charge is approximately 50% less than existing average tariff
PROJECT IMPACT
StatusOngoing construction of water treatment plant and conveyance facilities
Target completion date: 2019
ReplicabilityProject now serves as model for other water supply projects
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The Philippines is a highly urbanized country with approximately 50% of its total population residing in urban areas. (Asian Development Bank, 2014)
38%
22%
19%
16%
5%
Investment Requirements (per sector)
Water supply &sanitationTransportation
Flood control
Waste management
Others
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Urban Sector in the Philippines*
US$ 57 billion
Investment requirement (2008-2025) to meet basic urban services
*Based on ADB Report (2014): Philippine National Urban Assessmenthttps://www.adb.org/sites/default/files/publication/42817/philippines-national-urban-assessment.pdf
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Philippine PPP Program and Projects contributing to SDG 11
PPP Program
✓ PPP Program adapting to sectoral master plans
PPP Projects
✓ Water supply and sanitation✓ Transportation✓ Flood control✓ Waste management
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LRT Line 1 Cavite Extension & O&M
MRT Line 7 AutomaticFareCollection System
Southwest Integrated
Transport System
South Integrated
Transport System
Mactan-Cebu International
Airport
Muntinlupa-Cavite
Expressway
NAIA Expressway
Phase (II)
Metro Manila Skyway Stage 3
Cavite-Laguna Expressway
NLEx-SLExConnector
Road
Awarded Projects
Transport-Related Projects
General principles:❖Demand risk
generally allocated to private sector
❖User-pay principle
❖Regulated fees and adjustment mechanism
❖Performance-based
❖Commercial development rights
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Clark Airport -EPC & O&M
(separate procurement)
LRT Line 2 O&M
LRT Line 6
Pipeline of Projects
Road Transport IT Infrastructure
(Phase II)
PNR South -Commuter Line
O&M
Integrated Transport System - North Terminal
San Ramon Newport
Cebu Bus Rapid Transit (BRT) O&M
Motor Vehicle Inspection
System
East-WestRail
(unsolicited)
Manila Bay(unsolicited)
Metro Manila BRT O&M
BonifacioGlobal City (BGC) BRT
New Manila International
Airport (unsolicited)
Transport-Related Projects
www.ppp.gov.ph
PPPCenter.Philippines
@PPP_Ph
Public-private-partnership-center-of-the-philippines
PPPPinas
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