Industry Trend Analysis - PPP Failures Highlight Project Execution Risks - FEB 2017
BMI View: Difficulties and delays facing public-private partnerships (PPPs) in the Philippines, including an apparent lack of interest in many projects, highlight the gap between robust regulation and effective implementation of PPPs. While many countries across Asia are seeking to use PPPs to shore up infrastructure financing, improvements to their fundamental business environment are still necessary to ensure adequate project progression and investor interest.
The Philippines has one of the most robust public-private partnership (PPP) frameworks in Asia, but continues to struggle with implementing projects in a timely manner and generating sufficient interest in proposed undertakings. Of the 56 PPP projects launched since 2010, only four are complete as of January 2017, while many others have been repeatedly delayed by issues relating to financing, land acquisition or contract renegotiations. Projects also appear to be generating insufficient interest from investors and contractors - two-thirds of the contracts awarded have had fewer than three bidders, while several other projects have been retracted and placed under review after they initially failed to receive any bids.
Good Regulation Not Always Enough
|Project Risk Gaps|
|Asia - World Bank PPP Benchmark and BMI Project Risk Index|
|Note: Higher scores = better regulations/lower risk. Source: World Bank, BMI|