Governmental Fiscal Support for Financing Long-term Infrastructure Projects in ASEAN Countries

Gilberto M. Llanto and Fauziah Zen

No DP 2013-08, Discussion Papers from Philippine Institute for Development Studies

Abstract: This paper discusses governmental fiscal support for financing long-term infrastructure projects in ASEAN countries. More specifically, it discusses the role of guarantees and subsidies in promoting public-private partnership (PPP) projects. It draws on case studies of Philippine and Indonesian PPPs, and information from secondary sources to highlight the critical role of such fiscal support in making feasible the financing of long-term infrastructure projects that may be economically beneficial but commercially or financially unviable without such support. The paper points out the need for a strong fiscal position and analyzes the implications of guarantees and subsidies on fiscal management. An important insight is the need to secure budgets for long-term infrastructure projects, which may be done through a medium-term expenditure framework. Based on the analysis of Philippine and Indonesian case studies, it provides specific recommendations to improve the implementation of PPP projects.

Keywords: infrastructure; subsidy; government guarantee; Philippines; public-private partnership (PPP); concessions; fiscal space; contingent liabilities; affermage; turnkey contracts; medium-term expenditure framework (search for similar items in EconPapers)
Pages: 109
Date: 2013
New Economics Papers: this item is included in nep-cwa, nep-pbe, nep-ppm, nep-sea and nep-tre
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