LESS OBVIOUS IMPLICATIONS: Other forms of infrastructure could have less obvious environmental implications, thus, piped water supply in urban areas would have environmental benefit of reducing groundwater extraction but would also require better waste water treatment as greater water flows add to pollution through drainage systems.
KUCHING: Over the past two decades, more than 70 per cent of Asia’s investments in infrastructure have come from the public sector.
However – with rapidly increasing demand – if the region is to take a leap in infrastructure spending for basic infrastructure, more finance will need to come from private sources.
According to the regional development arm of the United Nations (UN) Economic and Social Commission for Asia and the Pacifi c’s (ESCAP) Paths to 2015: MDG Priorities in Asia and the Pacific, private investments does not usually focus on the needs of the poor, particularly in rural areas where perceived risks were high.
Although the chief benefit of expanding private sector involvement in infrastructure was likely to be release more public-sector funds for Millennium Development Goals (MDGs) achievement, attempts to create more public private partnership in promising areas of basic infrastructure should continue.
“For this to happen, it will also be important to stimulate the interest of the private sector by developing appropriate regulatory frameworks.
“Governments may also offer fiscal and other incentives to private-sector investors, while multilateral development institutions can help steer government and private investors through the difficult commercial and cost-sharing negotiations for the partnerships,” stated the report.
Managing the debt component of these projects could benefit from swap arrangements to alleviate foreign exchange risks.
Due to current increase in awareness of greenhouse emissions, it would also be of great significance for future investments in infrastructure to pay attention in areas of environmental impact.
“MDGs, for example – to improve power supplies, particularly in the rural areas.
This can bring benefits not just to the local economy but also for health and environment by reducing the use of wood burning stoves,” the report explained.
Other forms of infrastructure could have less obvious environmental implications, thus, piped water supply in urban areas would have environmental benefit of reducing groundwater extraction but would also require better waste water treatment as greater water flows add to pollution through drainage systems.
The report noted that more attention must be given to services that maximise equitable socio-economic benefits while minimising environmental impacts and the use of resources.
It also added that governments would want to enhance the complementarities between basic infrastructure investments and environmental protection and minimize conflicts.
While the most immediate gains for the MDGs were likely to come from better infrastructure at national levels, there were also huge opportunities for improving infrastructure at regional and sub-regional levels.
“For poor communities, some of the most immediate benefit of better connectivity will be degrees of cross-national integration between neighboring border areas which in their respective countries are often the more remote and poorer regions,” stated the report.
“Adjacent areas if Thailand, Indonesia and Malaysia for example have become part of a ‘growth triangle’. Brunei Darussalam, Indonesia, Malaysia and the Philippines have also formed an East Asean Growth Area.”
Recently there has also been an attempt to create a new growth triangle between Eastern India, Nepal, Bhutan and Bangladesh.
Regional transport infrastructure has also been developed in the form of an East West Economic Corridor in the Greater Mekong subregion as well as through a road that linked China with Kazakhstan, Kyrgyzstan and Uzbekistan stated the report.
The report noted that it was important that the physical links between countries were accompanied by harmonisation of standards such as railway signaling systems or customs codes.
All these would contribute to faster poverty reduction and progress on the MDGs.
One model for Kyrgyzstan, for example, showed that regional cooperation on integration projects for transport, transit and facilitation would nearly double the incomes of the poor noted the report.
At the regional level, government should press ahead with agreements for pan-Asian connectivity- through, for example, an Asian Infrastructure Fund and other aspects of a regional financial architecture, and a pan-Asian Infrastructure forum for sharing the experience with cross border projects.
Cooperation between countries in exchanging knowledge and best practices could also provide an important avenue in helping expand access to basic infrastructure.
In recent years countries across the region have made some progress in building new infrastructure.
Seen through an MDG lens, however, the results could at best be considered patchy-with futuristic airports and smart private hospital on one side and potholed rural roads and crumbling village health clinics on the other.
The challenge now was to change the criteria of success-to achieve higher standards of basic infrastructure that could underpin the MDG.
As the MDG target date of 2015 approaches, it seemed likely that the picture across Asia and the Pacific for the goals themselves was likely be mixed – some disappointing failures, some narrow misses, and some striking successes.
But the final MDG story was yet to be told said the report.
All countries still have a few more years left to choose the most promising paths – and tilt the balance decisively on the side of success.