Asia-Pacific Ministerial Conference on Public-Private Partnerships (PPP) for Infrastructure Development 2010

Excellency Pak Hatta Rajasa,
Coordinating Minister of Economic Affairs
Government of the Republic of Indonesia

His Execellency Ebrahim Azizi, Vice-President Planning and Strategy Supervision, Iran

Excellencies,
Distinguished Delegates,
Ladies and Gentlemen,

It is my pleasure and privilege to warmly welcome you to the Asia-Pacific Ministers Conference on Public-Private Partnerships for Infrastructure Development 2010.

ESCAP is delighted to assist the National Development Planning Agency in the preparations of this important Conference and I whould like to extend on behalf of all present here our appreciation and thanks to all officials and staff for their hard work in making this conference happen.

Excellencies,
Ladies and Gentlemen,

We are here because we belive that infrastructure will play a key role in this region’s future by promoting and sustaining economic and social development. The Asia-Pacific region is one of the world’s richest but at the same time it remains home to more than half of the world’s extreme poor. The financial crisis of 2008 has further widened the gaps between different communities. Poor rural communities are cut off by badly maintained roads, farmers have difficulty getting to markets, rural hospitals lack basic equipment, and rural school are in poor condition.

In this context, efficient economic and social infrastructure and services, and enhanced national and regional connectivity can play a major role in helping countries emerge from this latest crisis in a stronger position to promote development for all. ESCAP is promoting eco-efficient connectivity in the Asia-Pacific using a five pronged approach.

First, developing regional inter-modal transportation networks and corridors and improving trade facilitation;

Second, increasing paperless trade and a single window through improvements in ICT infrastructure;

Third, developing a regional financial mechanism to facilitate financing regional connectivity and development;

Fourth, promoting a regional energy security framework; and

Fifth, strengthening the social foundations for inclusive and resilient societies.

In the framework of this Ministerial Conference, allow me to elaborate some of the strategic areas which I believe are relevant for our discussion.

We are actively promoting regional connectivity through an intermodal integrated transportation infrastructure. The Trans-Asian Railway is a network of nearly 114,000 kilometers selected by 28 countries as vital arteries for economic development. Together with the 142,000 kilometers of the Asian Highway network, it will form the backbone of trade for the region, providing regional connectivity and linkages to Europe via the Russian Federation, Central Asia and the Middle-East via the Islamic Republic of Iran. Both networks in combination with “dry ports” will help more remote areas and landlocked countries gain access to trade and investment opportunities.

Building infrastructure alone will not be enough. Indeed, countries in the region are facing huge challenges in their export businesses. The hidden costs of red tape associated with trade add as much as 15 percent of the cost of goods being exported. ICT technologies and inter-connectivity can be used to streamline these processes in a single window, making them more transparent and predictable. Development of ICT infrastructure will also help promote knowledge connectivity, which will enable sharing of good practices as well as information required to derive the most benefits from improved regional connectivity.

The development of financial cooperation for infrastructure development provides an opportunity to generate aggregate demand and foster inclusive growth. To facilitate the financing of regional connectivity and development, the region must move toward a financial mechanism intermediating between emerging investment opportunities and rising foreign exchange reserves creating new opportunities to invest in the region’s future prosperity.

Efforts to improve regional connectivity must include people. When roads are built people move. However, this will bring two challenges: the first related to road safety while the second is one of personal well being. The safe transport of people, goods and services requires the strengthening of the foundations for social protection in the region to ensure the peaceful conditions required for trade. Social protection systems not only create a foundation for more inclusive and harmonious societies, they also make good economic sense.

Currently, only 20 percent of the region’s population have access to health care protection, with the largest out of pocket expenditure. The development of economic and social infrastructure thus becomes an important element in the promotion and building of regional connectivity. The ESCAP five pronged approach aims at increasing the consumer power of the poor and emerging middle class through decent work, social protection better healthcare and other inclusive policies, to unleash the potential of the world’s biggest countries, to contribute to economic development while reducing inequalities and social parities.

Excellencies,
Ladies and Gentlemen,

Financial stimulus packages that Asia-Pacific countries have put in place provide a unique opportunity to address a broad range of regional connectivity issues. But these stimulus packages cannot continue forever. But they must also be accompanied by PPP and a long term programme of action that addresses economic and social infrastructure issues based upon principles of inclusiveness and sustainability. In other words how do we generate mature wealth and profile by valuing and protection the greatest wealth of all – our people and our planet.

Excellencies,

The Seoul Ministerial Declaration on Public Private Partnerships was adopted in 2007. Progress has been made in a number of countries in Asia-Pacific.

The Seoul Declaration underscored the importance of regional cooperation and capacity building. In response ESCAP has provided technical assistance to Asia-Pacific countries by developing and delivering on-line educational and training programmes. We also contributed to the establishment of databases on public-private partnerships activity, laws, guidelines and model agreements.

During this Conference, you will have the opportunity to consider and adopt the draft text of the Jakarta Declaration on Public-private Partnerships for Infrastructure Development in Asia and the Pacific. The Jakarta Declaration reemphasizes the principles of promoting PPP in infrastructure development and requests countries to develop and implement policies in this respect. In other words, the focus is on implementation. The Declaration also requests United Nations, international financial institutions and bilateral donors to continue to provide technical assistance. It also proposes the establishment of a Task Force to elaborate the elements of a regional financial mechanism and the establishment of an Asia Pacific Network of PPP units and programmes.

If we are to be successful in these endeavours, it is clear that we need to work more closely together to address the challenges.

Already, the Asia Pacific region has examples of successful partnerships between a strong public sector and a strong private sector. This Ministerial Conference, the second of its kind, gives us a new chance to avail of this experience to build not only economic-based infrastructure such as power supplies, and roads, but also social infrastructure needed for health and education systems and for closing the development gaps in our region.

It is my sincere hope that this Conference will inspire and challenge us to seize new opportunities and redouble our efforts to create healthy public and private sector partnerships.

ESCAP is ready to play its full part in this endeavour along with our development partners.

Excellencies,
Ladies and Gentlemen,

With the depth of expertise here, I am sure that this conference will be another landmark in the region’s development. I wish you a successful conference.