Governments can't use public-private sector projects to offload all the risks, say industry players
Singapore
PUBLIC-private sector partnerships (PPP) are a constant tussle of risk-splitting between governments and private-sector investors and lenders.
But governments have to be realistic, said industry players at a recent investor conference organised by Maybank. They said governments can try to offload as much risk as possible - but not to the extent that the project no longer makes commercial sense to the private sector.
One participant at the conference specifically complained that, driven by Asean's rapid development, some governments seem to be pushing more risk to project owners and lenders, expecting lenders to continue to provide ever cheaper funding for infrastructure projects.
Grant Dooley, head of Asia at Hastings Fund Management, said the government can push all they want. "The private sector simply won't invest if the project does not meet its investment criteria and targ…
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