IFC ready to invest $700M in PPP projects
International Finance Corp. (IFC), the private sector lending arm of the World Bank Group, said yesterday the firm can “easily invest” up to US$700 million in the Philippines in terms of its participation in the country’s biggest Public-Private Partnership (PPP) projects but such still depends on the opportunity that will arise.
IFC East Asia and Pacific Director Vivek Pathak said the agency is very optimistic about the Philippine market and they will continue to invest in the country.
“The way IFC operates, we don’t really allocate budgets, we give in to the opportunity that arises in a country. We have a good track record in the Philippines. We were the earliest investors in the infrastructure and power sectors in the Philippines,” Pathak said in an interview with reporters on the sidelines of a PPP conference held in Makati on Tuesday.
“There was a year that we invested US$500 million to $700 million in a year. We can clearly do a lot more than what we’re doing now. So we don’t allocate funds… we just look at the opportunity. [The US$500 million to $700 million], we can easily invest that here in the Philippines,” he added.
Pathak emphasized that there are still a lot of opportunities for the private sector when it comes to developing the infrastructure and power sectors in the country.
“We remain optimistic about the Philippines. Philippines has better opportunity than any other countries in Asia Pacific… The private sector will be more than willing to invest,” he said.
He even pointed out that in order to unlock the potential of other sectors in the country such as tourism and agriculture, the country must invest heavily in the infrastructure industry.
During the conference, Pathak said it will be important for the government to ensure continued continuity of its PPP program in order to maintain its position as a regional leader in private sector engagement.
Pathak said that the Philippines has been a leader in PPPs in Asia due to its high level of private sector participation and very effective tapping of private funding for infrastructure.
To date, IFC acted as transaction adviser on two PPP projects awarded under President Aquino's administration which are the NAIA Expressway (Phase II) project and the LRT 1 Cavite Extension and Operations and Maintenance Project.
The NAIA Expressway (Phase II) Project for the Department of Public Works and Highways is nearing completion, while the concessionaire of the LRT 1 Cavite Extension and Operations and Maintenance Project signed a 24billion ($505-million) loan agreement on February 12, reaching financial closure in a relatively short period considering the size and complexity of the project.
As of now, the PPP Center, under the leadership of Executive Director Cosette Canilao, already awarded 12 projects worth 197 billion, or around $4.2 billion, with another 16 projects worth 623 billion under procurement and for roll out.