The Asian Development Bank (ADB) will be helping the Mindanao Development Authority (Minda) develop public-private partnership (PPP) projects.
In a briefing on Wednesday, ADB Philippine Country Office Richard Bolt told reporters that its work on PPPs with Minda will be the first extension under the Manila-based bank’s PPP policy loan.
“We will help Minda to establish a PPP [Center] which will be an extension of the national program. [There are] quite a few PPPs in the program that are already in the pipeline. This will be one of the first step we’ll take to building local capacity in PPPs,” Bolt said.
Bolt said these PPPs would likely fall in the category of solid waste management, water supply, sanitation and regional expressways in Mindanao. These, he said, would require regional perspectives that the national PPP Program will not be able to provide.
Bolt said the ADB will help Minda build the capacity of local agencies and determine which projects would be suited to be undertaken as a PPP and those that are better financed by the local or national agencies.
“It is to help Minda do that calculations. [This will focus] Minda’s responsibility on regional development planning and monitoring. It’s to help them to understand within the plan’s [Mindanao 2020] what is for PPP and what is for public investment,” Bolt said.
Last week the ADB disclosed that it is extending $600 million worth of loans to the national government to support its PPP initiative. The amount covers two $300 million-worth loans that seek to expand the private participation in infrastructure investment through the promotion of PPPs and support long-term finance for the Philippines.
The PPP-oriented loan will support improved systems to assess and budget for right-of-way acquisition and resettlement of communities.
It will boost capacity and staff at the national PPP Center, and help to finalize work on proposed amendments to the build-operate-transfer law which are critical for sustaining the PPP program.
The second loan will support reforms to the government bond market that will increase trading volumes and contribute to the development of a yield curve which can support pricing of corporate, project and infrastructure related debt.
The Manila-based multilateral development bank said revisions to the Insurance Code will increase the sector’s appetite for long-tenor investments, like infrastructure bonds, while parallel reforms will provide incentives to increase the country’s pool of long-term savings.
ADB said the program will also support the launch of the Personal Equity and Retirement Account, a long-term, tax-deferred personal retirement savings account. Competition will be enhanced through increased participation by foreign financial institutions.
