The Singapore government put a PPP program in place in 2004 and has since been successful in getting a number of projects off the ground.
“In Singapore, the public sector construction demand is expected to increase to between S$17bn and S$19bn this year with projects slated to proceed this year such as the MRT [railway] projects, including the Downtown Line, the North-South Line Extension and Jurong East Connection,” says John Brells, Asia-Pacific managing director of Hill International.
Lovells Lee & Lee managing partner James Harris says that there has also been a reasonable amount of infrastructure activity, particularly in the transport and power sectors, in Indonesia, Vietnam and the Philippines. “In Vietnam there is a port capacity shortage, which led the government to look at ports and related infrastructure such as roads and rail. There is a strong potential for work there, however, I’m not sure that the projects proceeded as far as many would have liked before the financial crisis hit,” he says.
The financial crisis will also have an impact on attempts to raise capital to fund infrastructure in India. The India Infrastructure Finance Company, a government SPV which provides funding assistance for infrastructure projects, was recently authorised to conduct multi-billion dollar capital raisings via the issue of tax-free bonds. However, some estimate that the country faces the challenge of raising close to US$190bn over the next three years to fund key infrastructure projects – a considerable feat, particularly given the liquidity crisis.