kiichiro fukasaku development centre
DESCRIPTION
Public Private Partnership in Infrastructure Development. Kiichiro Fukasaku Development Centre . Japan-OECD-Vietnam Public Private Partnership Forum Hanoi 3 rd March 2008. 1. Introduction. 4. 5. 2. 3. Challenges and Best Practice. OECD Policy Support. PPP in Infrastructure. - PowerPoint PPT PresentationTRANSCRIPT
![Page 1: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/1.jpg)
Kiichiro FukasakuDevelopment Centre
Public Private Partnership in
Infrastructure Development
Japan-OECD-Vietnam Public Private Partnership ForumHanoi 3rd March 2008
![Page 2: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/2.jpg)
Slide 2
11 IntroductionIntroduction
44 Challenges and Best PracticeChallenges and Best Practice
55 OECD Policy SupportOECD Policy Support
22 PPP in InfrastructurePPP in Infrastructure
33 Opportunities for AsiaOpportunities for Asia
![Page 3: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/3.jpg)
Slide 3
Introduction
• Financing fails to meet infrastructure needspeople lack access to infrastructure worldwide
1 billion people without access to roads 1.2 billion without safe drinking water, 2.3 billion without reliable energy 2.4 billion without sanitation
4 billion without modern communication
(Source: Promoting Pro-Poor Growth, OECD 2007)
![Page 4: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/4.jpg)
Slide 4
2000-10% of
World GDP 2010-20% of
World GDP 2020-30% of
World GDP
Road 220 0.38 245 0.32 292 0.29
Rail 49 0.09 54 0.07 58 0.06
Telecoms1 654 1.14 646 0.85 171 0.17
Electricity2 127 0.22 180 0.24 241 0.24
Water1,3 576 1.01 772 1.01 1 037 1.03
Total 1 626 2.84 1 897 2.49 1 799 1.79
1.Estimates apply to the years 2005, 2015 and 2025. 2.Transmission and distribution only. 3.Only OECD countries, Russia, China, India and Brazil are considered here.
(Source: Infrastructure to 2030, OECD 2007)
Outlook:Annual World Infrastructure ExpenditureEstimated averages in US$ billion and %
![Page 5: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/5.jpg)
Slide 5
Challenges
• Globalisation and impact on infrastructure
• Urbanisation• Growing interdependence between
infrastructure systems• Meeting future financial needs• Infrastructure vital for growth and vice
versa
![Page 6: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/6.jpg)
Slide 6
11 IntroductionIntroduction
44 Challenges and Best PracticeChallenges and Best Practice
55 OECD Policy SupportOECD Policy Support
22 PPP in InfrastructurePPP in Infrastructure
33 Opportunities for AsiaOpportunities for Asia
![Page 7: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/7.jpg)
Slide 7
Infrastructure• Efficiency vs. equity• High up-front costs, late returns on investment• High multi-faceted risks and uncertainty• Political dimension• Public good character• Limited access to financial markets
How to raise incentives for private sector involvement?
![Page 8: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/8.jpg)
Slide 8
Investment Commitments 1990 – 2006PPP in Infrastructure in Developing Countries
(Source: World Bank PPI Project Database)
![Page 9: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/9.jpg)
Slide 9
Investment Commitments by Sector
Total
Telecoms
TransportEnergy
Water
(Source: World Bank PPI Project Database)
2006 US$ billions
![Page 10: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/10.jpg)
Slide 10
Investment Commitments by Region
(Source: World Bank PPI Project Database)
2006 US$ billions
![Page 11: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/11.jpg)
Slide 11
11 IntroductionIntroduction
44 Challenges and Best PracticeChallenges and Best Practice
55 OECD Policy SupportOECD Policy Support
22 PPP in InfrastructurePPP in Infrastructure
33 Opportunities for AsiaOpportunities for Asia
![Page 12: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/12.jpg)
Slide 12
Global Competitiveness Report World Economic Forum, 2007-2008
(based on: World Economic Forum, The Global Competitiveness Report 2007-2008)
![Page 13: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/13.jpg)
Slide 13
Asia: the Private Sector Re-engaging in Infrastructure Development
2006 US$ billions
(Source: World Bank PPI Project Database)
![Page 14: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/14.jpg)
Slide 14
Private sector investment in infrastructure
Estimated infrastructure needs
1984-2005 Asia 284.0$ billion - East Asia /
Pacific75.0
cumulative - Southeast Asia 136.6- South Asia 67.5- Central Asia 7.5
2006-2010 Asia 248.8$ billion - East Asia /
Pacific178.9
per year - South Asia 63.1- Central Asia 6.8
(Source: ADB‘s Infrastructure Operations, ADB 2007)
![Page 15: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/15.jpg)
Slide 15
2006 US$ billions
(Source: World Bank PPI Project Database)
Asia: Regional Imbalance
![Page 16: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/16.jpg)
Slide 16
Asia: Regional ImbalanceEast Asia and Pacific South Asia
Population In millions 1823 1378
Poverty% living on less than US$ 1/day 15 31
Urbanisation% urban population 43 28
Electricity% with access to electricity 88 43
Water% access to improved water sources 78 84
Sanitation% access to improved sanitation 49 35
Transport% of rural population living within 2 km of all-season roads
95 65
Communication% fixed/mobile phone subscribers 36 6
(Based on: Nataraj, Infrastructure Challenges in South Asia, ADB Institute 2007)
![Page 17: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/17.jpg)
Slide 17
Vietnam
1st (best)
131th
(based on: World Economic Forum, The Global Competitiveness Report 2007-2008)
Status of infrastructure development ─ ranking among 131 countries
![Page 18: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/18.jpg)
Slide 18
Vietnam
• “Vietnam serves as an excellent example of how infrastructure can foster a sharing of the benefits of growth … Economic development has been remarkably pro-poor, lifting around 20 million people out of poverty.”
– Connecting East Asia, 2005
![Page 19: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/19.jpg)
Slide 19
11 IntroductionIntroduction
44 Challenges and Best PracticeChallenges and Best Practice
55 OECD Policy SupportOECD Policy Support
22 PPP in InfrastructurePPP in Infrastructure
33 Opportunities for AsiaOpportunities for Asia
![Page 20: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/20.jpg)
Slide 20
• Balance public and private engagement• Double imperative: profitability ↔ social
ends• Dichotomy of public and private interests• Limited institutional capacity• Specificity of infrastructure market• Commercial risks in developing countries• Political dimension
Challenges Ahead
![Page 21: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/21.jpg)
Slide 21
Connecting East AsiaA New Framework for Infrastructure – ADB, JBIC, World Bank – 2005
• Rapid growth yet marked by 1997 crisis
• Urbanisation vs. rural development• Regional infrastructure linkages• Environmental protection• Policy, agency & stakeholder
coordination• Funding challenge
![Page 22: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/22.jpg)
Slide 22
Connecting East Asia
New framework: Inclusive Development
Infrastructure helps connect growth to the
sharing of benefits
(adapted from: ADB/JBIC/World Bank, Connecting East Asia, 2005)
![Page 23: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/23.jpg)
Slide 23
India
Meeting infrastructure investment needs
Government investment in infrastructure
(Sources: OECD Economic Surveys: India, 2007; IMF World Economic Outlook, 2007; DEA/MoF/ADB, Facilitating Public-Private Partnership, 2006; Rastogi, India Infrastructure Report,
2006)
2006: $ 60 billion2008: est. $ 130
billion
2006: 4.7 % of GDP
≈ $
41 billion
2008: 8 % of GDP ≈ $
100 billion
![Page 24: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/24.jpg)
Slide 24
India
Viability Gap Funding:funds up to 20% of cost for state projects implemented by private sector developer (competitive bidding)
India Infrastructure Finance Company Ltd.:wholly government-owned company to provide long-term finance to infrastructure projects; priority for PPP
+ strong government commitment to PPP in infrastructure
(Sources: OECD Economic Surveys: India, 2007; DEA/MoF/ADB, Facilitating Public-Private Partnership, 2006; Rastogi, India Infrastructure Report,
2006)
![Page 25: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/25.jpg)
Slide 25
India: Lessons learnt
• Government commitment • Transparency and communication• Innovative financing schemes• Capacity building• Proper risk allocation (efficiency,
capacity)• Consideration of alternatives to PPP• Continuous private sector consultation
![Page 26: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/26.jpg)
Slide 26
11 IntroductionIntroduction
44 Challenges and Best PracticeChallenges and Best Practice
55 OECD Policy SupportOECD Policy Support
22 PPP in InfrastructurePPP in Infrastructure
33 Opportunities for AsiaOpportunities for Asia
![Page 27: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/27.jpg)
Slide 27
OECD Contributions
1. Monitoring OECD country policies in infrastructure developmentInfrastructure to 2030 Economic Surveys International Investment Perspectives
2. Support to public policy-makingOECD Principles for Private Sector Participation in Infrastructure
3. Support to donors Promoting Pro-Poor Growth: Four Guiding Principles for Meeting Infrastructure Challenges
![Page 28: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/28.jpg)
Slide 28
Infrastructure to 2030
• Average annual infrastructure investment requirements to 2030: 3.5 % of World GDP
• Government budgets tied to social spending in the future
• New “business models” and innovative financial solutions needed
Analysis by sector
![Page 29: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/29.jpg)
Slide 29
Policy Guidance for Governments
OECD Principles for Private Sector Participation in Infrastructure
• practical implementation tool of 24 principles • aimed at governments and private sector actors• illustrates how to :
1.Design and manage PPP projects in infrastructure
2.Improve the institutional environment3.Encourage responsible business conduct
![Page 30: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/30.jpg)
Slide 30
OECD Policy Guidance for Donors
Four Guiding Principles for Meeting Infrastructure Challenges
1. Use partner country-led framework for coordinated donor support
2. Enhance infrastructure’s impact on poor people
3. Improved management of infrastructure investment for sustainable outcomes
4. Increased and efficient infrastructure financing
(Source: Promoting Pro-Poor Growth: Policy Guidance for Donors, OECD 2007)
![Page 31: Kiichiro Fukasaku Development Centre](https://reader036.vdocument.in/reader036/viewer/2022062410/56815d38550346895dcb39b1/html5/thumbnails/31.jpg)
Thank you!Kiichiro Fukasaku
Development Centre