PPPs in developing Asia have evolved considerably in recent years. Governments are no longer the sole provider of essential public assets and services. And, although investments in infrastructure are still dominated by the public sector, the private sector is playing a larger and increasingly important role in developing, building, and improving public goods and services.
The World Bank's Private Participation in Infrastructure Database-a widely used resource in this book-has logged over 6,400 infrastructure PPP projects that have at least 20% private ownership and reached financial closure in 139 low- and middle-income countries. The database is a valuable resource for gauging PPP trends, particularly in energy, telecommunication, transport, and water and sewerage. The database shows that the number of PPP projects that reached financial closure in developing Asia between 1991 and 2015 rose by a compounded annual growth rate of 11% (ADB 2017a).1 In aggregate, the number of PPPs in developing Asia account for half of all PPPs in developing countries. But the distribution of PPPs is uneven across countries and sectors. More than 70% are in East Asia and South Asia, and 90% of that share is in India and the People's Republic of China. Even so, PPPs are gaining ground in Southeast Asia, particularly in the larger economies of Indonesia, Malaysia, the Philippines, Thailand, and Viet Nam. Central Asia and the Pacific together account for only 2% of the region's PPPs.
The Economist Intelligence Unit's 2014 Infrascope analyzed the readiness of countries in Asia and the Pacific to deliver sustainable PPPs (EIU 2015). It reported significant improvements in developing Asia in how governments handle PPP projects, based on its evaluation of regulatory and institutional frameworks, the investment climate, and the availability of finance. Of the 19 countries surveyed, India, Japan, the Philippines, and the Republic of Korea were considered to have "developed" PPP markets: 10 countries were classified as having "emerging" PPP markets in terms of their capacity to select, design, deliver, manage, and finance domestically PPP projects. The PPP market in the People's Republic of China was the most mature of the economies in the emerging group. Infrascope classified three countries-Georgia, the Kyrgyz Republic, and Tajikistan-as having "nascent" PPP markets, where the institutional and technical capacity required to deliver complex PPP projects was not in place.