APEC finance officials debate public and private financing of infrastructure



The U.S. Treasury, as 2011 host of APEC's Finance Ministers' Process, and the World Bank Group have joined forces to strengthen successful financial planning of infrastructure projects, which is crucial for achieving the goal of a seamless regional economy and rebalancing the sources of economic growth in the Asia-Pacific region.

A conference was held this week at World Bank headquarters in Washington D.C. for policy makers from economies in the region on 'The Framework and Options for Public and Private Financing of Infrastructure.  

The two-day gathering included presentations and panel discussions by senior experts from APEC economies on both sides of the Pacific, private sector asset managers, academics, and experts of the multilateral development banks and the IMF.

Charles Collyns, Assistant Secretary for International Finance at the US Treasury, said the workshop provided economies with the opportunity to learn and share experiences about the issues they confront in planning infrastructure projects and seeking to engage the private sector.

'As all of us here today know all too well, infrastructure does not come cheap,' said Assistant Secretary Charles Collyns. 'Building the roads, bridges, power plants, and rails that will drive growth in this region over the next decade will require trillions of dollars in new investment, including from the private sector.

'Today's discussion will encourage mutual learning about the challenges of infrastructure financing, including how APEC economies can tap into increasingly large sources of long-term capital, and help us to find solutions that are applicable to the unique conditions of each country.'

World Bank Managing Director Sri Mulyani Indrawati addressed the June 22-23 workshop, held at the World Bank headquarters, on 'Building Solid Governance Foundations for infrastructure'.

'In an environment of constrained fiscal space, most APEC economies face challenges to efficiently mobilize public investments in infrastructure,' said Mulyani. 'There is also a huge potential of public-private partnerships in developing infrastructure in the APEC region, which needs to be fulfilled.'

'Through this conference, the Bank has been pleased to partner with the U.S. Treasury and APEC to contribute to supporting these economies' efforts to make public investment programs more effective and launch public-private partnership schemes that work.'

Accelerating investment in infrastructure and improving service delivery is critical for the Asia-Pacific and it continues to recover from the global financial crisis and seeks to expand prosperity more broadly across the region.

Inter-regional trade is a component of the recovery, meaning improvements to supply chains and production networks are key issues for all APEC economies.

Discussions at the conference explored the growth in the infrastructure financial asset class; how to strengthen public investment programs in infrastructure; whether to pursue public or private financing for infrastructure projects, and how to create a solid pipeline of well prepared public-private partnership (PPP) projects; how to manage fiscal risks of PPPs; leveraging capital markets for infrastructure finance; and investor perspectives on participation in infrastructure.

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