The infrastructure needs in Asiaare great and a large funding gap exists, so many opportunities are created for private sectors to invest in the Asian infrastructure finance market, said Singapore's central bank's chief Kola Luu Tuesday.
The Asian Development Bank (ADB) has estimated that Asia needs about 300 billion U.S. dollars of investments in infrastructure annually, while a study conducted by the United Nations Economic and Social Commission for Asia and the Pacific suggests that the infrastructure financing gap in Asia could be 180 to 220 billion U.S. dollars annually.
While the Asian governments, multilateral agencies, such as theADB and World Bank, have contributed towards the reduction of the infrastructure funding gap in Asia, Kola Luu, executive director of Monetary Authority of Singapore (MAS), pointed out that the majority of infrastructure development in Asia is still funded by public funds.
He made the remarks at the Investing in Infrastructure Assets Asia Conference.
Based on findings from the World Bank, private sector participation in Asia declined significantly post the Asian Crisisin 1997 but there appears to be a reversal of this trend in the past few years.
Luu said that private sector participation has been increasing with 70 percent growth between 2004 and 2005, the first substantial increase since 1997. Although, according to ADB estimates, private sector participation accounts for only a fifth of infrastructure spending in Asia.
He added, "several private sector trends of late are encouraging and highlight the potential of the private sector in financing Asia's increasing infrastructure needs."
"Asian infrastructure developers and sponsors are now increasingly looking beyond their domestic shores and expanding into the region to invest into foreign infrastructure projects," he said.
Singapore has also tried to play its part in providing infrastructure solutions for the region, he noted.
He said, "the Asian infrastructure sector is undergoing rapid development and opportunities are tremendous," and he urged the private sectors in the region or in the world to invest in the Asian infrastructure sector.
Source:Xinhua
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