Tuesday, 15 December 2009

RP infra spending seen hitting $9B

Doris Dumlao

THE PHILIPPINES WILL LIKEly spend about $9 billion in transport infrastructure within the next five years and increasingly rely on private sector investment to catch up with the robust transport expenditure elsewhere in Southeast Asia, global advisory firm KPMG International said

In its recent publication “The Global Infrastructure: Trend Monitor,” which contained an outlook for Southeast Asian infrastructure for 2010 to 2014, KMPG noted an emerging deficit between the needs for transport infrastructure investment in the region and the available funds from public sources. It stressed that private sector investment was becoming an increasingly vital solution.

“Nations such as Vietnam, the Philippines and Indonesia have drawn on international financing institutions and official development assistance to improve their transport infrastructure. However, in recent years, they have been exploring the potential for public and private sector partnerships,” the research said.

The Philippines was described in the study as “one market with relatively low growth rates but which is close to being an established market in terms of expenditure.”

The yearly transport infrastructure spending in the Philippines was projected to rise from $1.78 billion next year to $1.83 billion by 2014, but this and the $9 billion cumulative investment for the next five years still lagged behind those in other major economies in the region. The annual transport infrastructure expenditure in the region for 2014 was seen reaching $32 billion, about 15 percent higher than the 2010 level, with Indonesia, Malaysia, Singapore and Thailand likely to account for more than 80 percent of the total. Indonesia alone was projected to spend over $48 billion between 2010 and 2014.

Brunei, Cambodia and Laos were projected to have combined investment from 2010 to 2014 of around $2.4 billion, or 1.6 percent of the total, although they represent only 3.5 percent of the population.

The Philippines and Singapore are seen posting transport expenditure growth at rates below 2 percent, it said.

KPMG said Brunei’s level of investment was expected to contract by an average annual rate of 1.5 percent, while the Philippines was seen to post the smallest growth of 0.8 percent a year.

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