As the custodians of the country, Governments are entrusted with the responsibility to develop new public facilities and infrastructure, operate and maintain such public facilities and undertake significant upgrades to existing public facilities and infrastructure, to serve the needs of its people. Governments in developing and developed countries have sought participation from the private sector as an alternative additional source of development and funding. The Public-Private Partnership (“PPP“) model provides Governments with the capacity to assess and manage fiscal impact whilst managing the risk transfer between the public and private partner to extract long-term value-for-money over the life of the project.
The advantages of adopting a PPP model to undertake infrastructure projects are:
- increasing project financing options by way of the private partner providing capital and/or financing arrangements to undertake the project;
- reducing the public sector’s budget constraints, thereby making public funds available to be applied by the Government for the welfare of its people;
- improving accountability in the provision of infrastructure and public services to deliver projects on time and within budget;
- imposing budgetary certainty by setting present and future costs of infrastructure projects and provision of public services;
- harnessing private sector innovation and efficiency; and
- stimulating growth and development in the country.
This publication serves as a guide to highlight:
- the similarities and differences of the reasons and motivations for implementing the PPP model by the Governments of countries in Southeast Asia (“SEA“). A deeper appreciation of these differences and similarities will be a valuable consideration in understanding the expectations of SEA Governments in implementing the PPP model, which will enable international private investors to plan properly when engaging in PPP arrangements in SEA; and
- the framework and policies for government procurement adopted for infrastructure projects in SEA. To some extent, the system of public procurement adopted by SEA encourages open competition and accountability, but is also tailored to reflect the needs and values specific to each country, whereby government policies are used to accord protection to domestic suppliers of goods and services, and preference for local or native companies.
For more information, click here to read the full Legal Update.
Disclaimer
Rajah & Tann Asia is a network of member firms with local legal practices in Cambodia, Indonesia, Lao PDR, Malaysia, Myanmar, the Philippines, Singapore, Thailand and Vietnam. Our Asian network also includes our regional office in China as well as regional desks focused on Brunei, Japan and South Asia. Member firms are independently constituted and regulated in accordance with relevant local requirements.
The contents of this publication are owned by Rajah & Tann Asia together with each of its member firms and are subject to all relevant protection (including but not limited to copyright protection) under the laws of each of the countries where the member firm operates and, through international treaties, other countries. No part of this publication may be reproduced, licensed, sold, published, transmitted, modified, adapted, publicly displayed, broadcast (including storage in any medium by electronic means whether or not transiently for any purpose save as permitted herein) without the prior written permission of Rajah & Tann Asia or its respective member firms.
Please note also that whilst the information in this publication is correct to the best of our knowledge and belief at the time of writing, it is only intended to provide a general guide to the subject matter and should not be treated as legal advice or a substitute for specific professional advice for any particular course of action as such information may not suit your specific business and operational requirements. You should seek legal advice for your specific situation. In addition, the information in this publication does not create any relationship, whether legally binding or otherwise. Rajah & Tann Asia and its member firms do not accept, and fully disclaim, responsibility for any loss or damage which may result from accessing or relying on the information in this publication.
