An assist for local governments

The donation of nearly 13 hectares of road lots by two private companies to the Mandaue City Government is a grand gesture that potentially benefits the city’s constituents, as well as commuters who use these roads.

Mayor Luigi Quisumbing expects the donation will enable the City to maintain the roads, all in the reclamation area, which could mean more traffic lights, fewer potholes, and better drainage.

For their gesture, F.F. Cruz and Mandaue Realty Resources Corp. deserve thanks from hundreds of thousands of Metro Cebu’s residents. Their donation also reminds us that the private sector plays important roles in making sure that land and other properties are used more efficiently.

A few days before the donation, which the donors and Mandaue City officials signed last Monday, Public Works Secretary Mark Villar appealed to Cebu’s private sector, especially business leaders, to support the administration’s efforts to build infrastructure faster.

How? Villar said that the local business community could help the Department of Public Works and Highways negotiate with owners whose properties are needed for road right-of-way. He described right-of-way acquisition as one of the hardest phases of public infrastructure projects.

Government’s need for private sector expertise is most pronounced in economic development activities, because that’s where government expertise is often short. Government agencies are often sufficiently trained in “citizen-facing” roles like delivering public services. But they need the private sector’s insights and experience to improve “market-facing” activities, which include stimulating investments and productivity, as well as designing incentives.

Unlocking underused assets is one area where governments can lean on private sector expertise, wrote Debra Mountford in her November 2009 paper “Organizing for local development: the role of local development agencies.” In that paper, published by the Organization for Economic Cooperation and Development, Mountford identified several areas where public-private development agencies have shown commendable results. These include the branding and international promotion of cities; investment attraction; green development; and infrastructure development.

Cebu is fortunate to have such a dynamic private sector to help untangle its problems.