ADB to assist with Asian infrastructure
ADB to assist with Asian infrastructure
MANILA (AFP): The Asian Development Bank (ADB) said yesterday it would help developing member countries meet massive infrastructure requirements through novel financing schemes proven effective in certain Asian countries.
Asian governments are being urged to utilize schemes such as the build-operate-own (BOO) and build-operate-transfer (BOT) programs, said John Taylor, director of the bank's infrastructure, energy and financial sectors department, to offset a lack of resources.
The ADB said it would assist in "formulating and negotiating BOT projects."
It has been projected that Asia will need more than one trillion dollars worth of infrastructure investment in the next decade, with US$450 billion alone going to energy and transport. The rest will go to water supply, telecommunications, and waste disposal.
Infrastructure investments involving BOT programs can be funded by the ADB up to $50 million, but did not say whether it would be in the form of equity or loans.
It added that it could "mobilize similar commercial co- financing" especially for projects in the power, toll roads, mass transit and water supply services.
The ADB has cited Bangladesh, China, India, Indonesia, Pakistan, Thailand, Philippines, Thailand and the whole of Indochina as developing member countries "with major infrastructure requirements."
In an article in its bi-monthly publication, the ADB review, Taylor cited Malaysia and the Philippines as two countries that had found innovative ways to meet infrastructure and energy requirements through privatization of existing assets and the "contracting out" of the operation and maintenance of infrastructure services.
He noted the Philippines' success in solving a crippling power crisis after "an aggressive BOT program," which attracted Japanese, American, Hong Kong and European investors. Those projects generate more than 6,000 megawatts of power.
BOT programs involving the private sector "allows governments to reallocate scarce resources from infrastructure" to poverty alleviation, health and education programs, Taylor said.