Private Sector Roles in CAREC

Over 30 senior officials and members of the Central Asia Regional Economic Cooperation (CAREC) trade and infrastructure sector coordinating committees participated in an ADBI seminar on Private Sector Participation and Investment in Physical Infrastructure for CAREC in Tokyo, 5–7 March 2008. ADBI organized the seminar in coordination with ADB headquarters, and with the collaboration of the European Bank for Reconstruction and Development, the Islamic Development Bank, the World Bank, and a number of private sector organizations representing investor interests.

Masahiro Kawai, Dean of ADBI, in his opening address, highlighted the dynamic transformation and remarkable economic growth experienced by the CAREC region over the last two decades. He emphasized that infrastructure development and the policy reform efforts now underway by many countries in the CAREC region, particularly those to improve governance and encourage private sector development and investment, will be important drivers for sustaining this strong economic performance in the medium to long term.

Sean O’Sullivan, Deputy Director General of ADB’s Central West Asia Department, welcomed the CAREC delegates and underlined the importance of connectivity for the CAREC region. He highlighted the need to further accelerate infrastructure development across the region to improve connectivity, expand trade and access to markets, and support broader economic growth. Mr. O’Sullivan pointed out the important role for the private sector to support infrastructure development in CAREC. In addition to recognizing the potential private sector financing offers to expand investment currently sourced by CAREC country governments, Mr. O’Sullivan placed significant emphasis on the extensive infrastructure management expertise and access to new technology the private sector offers to the CAREC region.

Takehiro Hashimoto, Division Director, Macquarie Japan, the seminar’s keynote speaker, underlined the enormous interest of the private sector in global infrastructure investments as demonstrated by the huge increase in the number of infrastructure investment funds worldwide. Drawing on Macquarie’s extensive infrastructure experience in Asia and worldwide, Mr. Hashimoto provided a “private sector investor’s” perspective of the main challenges to accelerating the public–private partnership process and the development of a “bankable” pipeline of projects for the CAREC region.

The seminar aimed to enhance the understanding of participating senior policymakers of the benefits and main challenges to achieving greater PPPs for infrastructure development across the CAREC region. The participants reviewed the links between infrastructure development and economic growth and poverty reduction, and assessed the infrastructure financing challenges faced by the CAREC region. They focused on the opportunities and advantages PPPs offer, the modalities that have evolved, and the key policy issues that need to be addressed by governments in the region for projects to be “bankable.” They also reviewed energy and transport case studies to determine those points of project design or negotiation that enabled the deal to be successfully concluded or resulted in a breakdown of the deal process. Each of the eight CAREC country delegations, through facilitated group sessions, was able to identify those priority policy issues that need to be profiled in their respective countries to strengthen the PPP enabling environment and better enable a pipeline of bankable infrastructure projects to be developed for the CAREC region.

View speeches and seminar materials.