Public-private partnership needed for Asia’s growth: ADB
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Asian public and private sectors should closely collaborate to create better infrastructure and finance and closer trade links to spur regional growth, said a recent Asian Development Bank’s panel meeting in Hanoi.
This will establish a firm foundation for strong, collective, long-term growth for the region, said the seminar, “The Role of the Private Sector in Promoting Regional Integration: Trade and Cross-border Infrastructure,” which has been held at the 44th Annual Meeting of ADB's Board of Governors panelists.
The event has gathered public and private sector experts to discuss how the two sides can ensure that the entire region advances together.
Asia’s economy as a whole is expanding swiftly, with growth in developing Asia estimated at 9.0 percent last year and forecast at 7.8 percent this year and 7.7 percent in 2012.
However, both within the region and within individual countries some are benefiting far more than others. Despite strong economic growth in recent years, the region still has nearly 2 billion people living on less than $2 a day.
With governments and development banks unable to finance the gamut of investments needed in the region, private sector participation is key. Guarantees, public-private partnerships, and other risk mitigation instruments can all help to mobilize hesitant private money.
"While governments can, and should, ensure an appropriate enabling environment for the private sector to grow and thrive in, it is the private sector that provides the most efficient allocation of resources and an enduring source of economic growth,” Lakshmi Venkatachalam, ADB's Vice President for Private Sector and Cofinancing Operations said in opening remarks to the discussion.
“Although there are already many success stories of Public-Private Partnerships in the region, many more opportunities do remain for the public and private sectors to come together to make the often very large and complex investments happen," she added.
ADB has long promoted regional integration as a means of ensuring sustainable growth for the whole of Asia. Among other initiatives, it is contributing to the Credit Guarantee and Investment Facility to support cross-border bond issuance.
It continues to finance transport and energy networks, and promote international trade in the region through guarantees and loans from its Trade Finance Program.
The speakers on the panel were Peter Amour, founder and Chief Executive Officer of AIF Capital; Bambang Brodjonegoro, Head of the Fiscal Policy Office of the Indonesia Ministry of Finance; Harjit Bhatia, Chairman and Chief Executive Officer of Asia Growth Capital Advisors (HK) Ltd.; David Fernandez, Managing Director and Head of Emerging Asia Research at JPMorgan; Fiona Lake, Executive Director and Global Markets Economist at Goldman Sachs; and Khempheng Pholsena, Minister to the Prime Minister’s Office and Head, Water Resources and Environment Administration in the Lao People’s Democratic Republic.
Pholsena said suitable frameworks, policies, and opportunities are key to attracting private sector investment in the region. She pointed to the Greater Mekong Sub-region organization which has attracted investment in infrastructure, energy, telecommunications and tourism projects.
