Foreword

The rapid growth in developing Asia's infrastructure has helped power the region's fast growth. Despite their impressive performance, many developing countries have glaring infrastructure deficits in electricity, transport, and water and sanitation. It is estimated that annual investments of $1.7 trillion, including for climate mitigation and adaptation, will be needed across developing Asia in 2016-2030 to maintain the region's growth momentum, eradicate poverty-the region's main unfinished development agenda-and take effective action against climate change. Indeed, infrastructure will be a key element in attaining the Sustainable Development Goals, and its expansion will be vital for tackling Asia's rapid urbanization and strengthening value chains.

Governments recognize the need to expand and modernize their infrastructure. But tight fiscal conditions are preventing them from developing infrastructure at anything like the level needed, and especially in economies that are lagging behind. With most of developing Asia's countries grappling with fiscal deficits, policymakers are increasingly looking to partnerships with the private sector to help close infrastructure gaps. Of course, the private sector was instrumental to Asia's economic success. Sustaining that performance, however, will depend on the private sector taking on a much bigger role than it has been playing so far in building and upgrading the region's infrastructure. But what is that role exactly? The objective of private sector participation in infrastructure should go beyond attracting investments to help close the infrastructure gap. The primary goal should be to deploy all the resources and expertise of the private sector in the provision of physical infrastructure and infrastructure services, especially its incentivized finance, operational efficiency, and innovation capacity.

Public-private partnerships (PPPs) have been an effective conduit to channel private capital and funds to address a broader development agenda. This book, the result of a productive collaboration among the Asian Development Bank, the Korea Development Institute, and other experts, presents the potential economic benefits from PPPs and the factors behind successful partnerships in infrastructure. It draws on the experiences of several Asian countries for lessons on what to do-and what not to do-for the effective and efficient implementation of PPPs. Good governance is a common thread that runs through the successful implementation of PPPs. The findings of this book will surely encourage countries to reexamine their regulatory and policy arrangements for PPPs and, where needed, to strengthen governance and public sector capacity for these partnerships.

This book is aimed at policymakers and their development partners striving to expand national and regional infrastructure, officials working on PPPs at all levels of governments, the business communities, and researchers. Governments, private partners, commercial banks, and international financial institutions such as the Asian Development Bank should collaborate to make the most and best use of PPPs to foster inclusive and sustainable development in developing Asia. We hope that this book will facilitate future collaborations to make PPPs better governed, more effective, and more sustainable.