3. The Minister of Planning and Budget of the Republic of Korea extended his warmest welcome to the delegates and acknowledged with appreciation the high-level of participation in the Conference. He underscored the importance of infrastructure investment to the socio-economic development of the Asian and Pacific region, and observed that the total annual financing needs for infrastructure development in the region in the next five years would be around US$160 billion, representing about 6 per cent of GDP. Limited public budget could only fulfil about half of that demand.
4. Highlighting the significant role that public-private partnerships (PPPs) played in increasing available resources and enhancing efficiency and sustainability of public services, the Minister said that this had brought many challenges, giving rise to the need to foster greater understanding of the issues relating to PPPs as well as to exchange information and experiences among regional leaders. It was therefore essential to provide a regional platform whereby diverse experiences could be exchanged and important policy issues addressed as well as to strengthen the role of regional cooperation in tackling the challenges in this field.
5. The Minister noted that countries in the region had different political, economic, social and cultural backgrounds and, therefore, there was no PPP model that could be considered equally suitable for all countries. However, despite these significant differences between nations, one fact applied to everyone: building partnerships and sharing responsibilities between the public and private sectors would contribute towards ensuring successful implementation of PPPs. He also noted that the provision of an institutional framework for PPPs and promotion of good governance were critical issues requiring greater government effort.
6. In the Republic of Korea, demand for public investment in other sectors such as social welfare, educational and defense facilities had limited the Government's ability to set aside funds for infrastructure development. In order to bridge the gap between demand for infrastructure investment and supply, focus of attention had been placed increasingly on enhancing private sector investment in infrastructure development. In this context, the Minister noted that his Government's spending had focused mainly on ensuring future growth and meeting the basic needs of the people, while private investment was utilized in those areas that required the efficiency and effectiveness of the private sector. He also mentioned that, in August 1994, the Private Participation in Infrastructure (PPI) system was first introduced by virtue of the PPI Act. The Act was revised in 2005 to embrace social infrastructure such as educational, cultural and social welfare facilities. By the end of 2006, the share of private investment to public investment in infrastructure development exceeded 17 per cent.
7. In concluding, the Minister expressed the view that member countries of the region needed to share best practices and come together to discuss issues of common concern, thereby facilitating the institutionalization of the PPP system in each country. He also underscored the importance of the expected outcome of the Conference, namely the Seoul Declaration on Public-Private Partnerships for Infrastructure Development in Asia and the Pacific, which would provide an effective instrument for fostering collaboration among countries in the region. He also expressed confidence that the Conference would serve as a major step forward in the establishment of a regional network and revitalizing PPPs.