(Yicai Global) Nov. 27 -- China has the most 'public-private partnership' (PPP) projects that reach financial close, but there is still room for China to expand its PPP scale by attracting the participation of more private enterprises, Asian Development Bank (ADB) said in "PPP Monitor," its first annual report that tracks the "PPP Operating Environment" in member countries.
Countries in the Asian-Pacific region with developed financial markets, strong local financial institutions and diversified sources of financing are more likely to promote PPP projects, ADB said in its report quoted by Economic Information Daily on Nov. 27.
In most countries surveyed by the "PPP Monitor," both thermal power generation and renewable energy power generation account for a dominant share, showing that energy production has become one of the most successful areas where the PPP model is applied. Water conservancy is also a major area of PPP investment, with over 40 percent of PPP projects in China concentrated in this area, the report highlighted.
ADB's study on 25 developing economies indicates that the USD204 billion annual funding gap of the USD457 billion investments in infrastructure requires contribution of the private sector. From 2013 to 2016, ADB approved 257 loan and technical assistance projects containing PPP factor.
India, Philippines and Thailand have the most developed financial markets and are able to offer longer-term (over 10 years) local currency loans to support infrastructure construction, the ADB report says, adding these markets have a range of financing options including project debt financing.
China's ministry of finance ordered an overhaul of the country's existing PPP projects on Nov. 16 and tightened approval rules for new projects. The value of China's 14,220 existing PPP projects totaled CNY17.8 trillion yuan (USD2.69 trillion) by end-September, according to a national database managed by the finance ministry, Reuters news agency reported.