Key Issues for PPP Infrastructure Development in Emerging Economies: A case of Dutertenomics in the Philippines Susumu ITO Chuo University, Tokyo, Japan
[email protected] August, 2018 Abstract This paper examines environment for PPP infrastructure development in the Philippines by focusing on major policy shift on PPP from Aquino to Duterte administration. While Aquino administration focused PPP-based infrastructure development as a priority policy, the Duterte administration launched "Dutertenomics", a large-scale infrastructure development plan of about 8 trillion pesos, about 160 billion USD, over 6 years in 2017 which mainly depends on national budget and ODA as a financial source rather than PPP. This triggered debate on "PPP vs ODA" in the Philippines. In this paper, key issues for further improvement of PPP environment in the Philippines will be discussed for policy recommendations: (1) enactment of PPP law, (2) development of "bankable" project, (3) government guarantee for contingent liabilities, (4) risk sharing mechanism, (5) foreign capital deregulation, and (6) development of capital market. Keyword: Public-private partnership, Infrastructure, Philippines JEL Classification Codes: E22; H54; O18 1. Introduction Infrastructure such as roads, railways, and electric power is a major premise for economic development, as well as improving people's lives and contributing to poverty reduction. In many emerging countries, the necessity of infrastructure development is high, further considering future population increase and economic growth, it is one of the most important policy issues. There are many estimates on the difference, infrastructure gap, between the infrastructure investment necessary amount and the investment forecast amount in emerging countries.