Opening Address By Mrs Lim Hwee Hua, Senior Minister Of State For Finance And Transport At The Official Launch Of The Asia Infrastructure Project Development Pte Ltd On Tuesday 15 April 2008 At 10:30 Am At The Fullerton Hotel Singapore

Dr Bindu Lohani, Vice President for Finance and Administration, Asian Development Bank

Mr Li Ming Lin, Minister Counsellor (Economic and Commercial), Embassy of People's Republic of China to Singapore

Distinguished Guests

Ladies and Gentlemen

1. A very good morning to all of you, especially our friends from the Asian Development Bank (ADB) who have travelled to Singapore for this occasion.

2. It gives me great pleasure to be here today to deliver the opening address for the official launch of the Asia Infrastructure Project Development Private Limited, or AIPD.

Challenges to Urban Infrastructure Investment in Asia

3. This is a very opportune time to set up an initiative like the AIPD as there is a huge demand for urban infrastructure investment in Asia. Urbanization in Asia revolves around the challenge of meeting the needs of some 44 million people being added to the population of cities annually, or the equivalent of an additional 120,000 people each day. This translates into the construction of more than 20,000 new dwellings, 250 kilometres of new roads, and the supply of more than six million litres of potable water^[1] every year. However, there is a lack of urban infrastructure investment to feed this burgeoning demand due to two important factors.

4. Firstly, at the municipal level, there is a shortage of technical and financial capabilities to package commercially viable infrastructure projects that can attract funding from commercial banks and private sector investors. Even if the necessary funding were obtained, there would still be a lack of public and private expertise to independently manage and bring these projects to fruition.

5. Secondly, private sector investors and financiers often face challenges in identifying suitable projects in a timely manner because of insufficient information. They also have limited access to local governments to gather and develop data for screening and evaluating potential projects. This information gap is an impediment to private sector participation in the region's infrastructure development projects.

AIPD: A Pioneering Initiative

6. Set against this backdrop, AIPD aims to proactively facilitate the development of Public-Private Partnership (PPP) projects, particularly in the water sector. The formation of AIPD is both a timely and innovative approach conceptualized jointly by ADB and Singapore Cooperation Enterprise or SCE to address the key constraints that I have just mentioned. AIPD will offer a single window to integrate the necessary public and private sector expertise to address the deficit in capabilities. It will also leverage on the ADB's strong regional networks to closely engage municipal governments in the development of infrastructure projects so as to minimise information gaps.

Sharing Singapore's Expertise in Water and Environmental Management

7. The initial focus on water and environmental management fits very well with what Singapore can offer. Over the past few decades, Singapore's public and private sector water players have played significant roles in tackling the challenges faced by water-scarce Singapore. They have developed valuable expertise in the process. For example, our wastewater treatment rate is 100%. All wastewater is collected and treated with membrane and ultraviolet (UV) technologies to produce high quality NEWater.

8. We are fortunate to have achieved good results in water and environmental management thus far, having invested significantly in research and development. In 2006, Singapore committed S$300 million over 5 years to promote R&D in the field of water and environmental management. In recognition of the progress and achievements that Singapore has made in integrated water resources management, our national water authority, the Public Utilities Board (PUB), was awarded the prestigious Stockholm Industry Water Award in August 2007.

Business Opportunities for Singapore's Water Industry

9. In terms of business opportunities, the AIPD is expected to generate US$150million worth of PPP projects for private companies annually, including Singapore and other international water companies. I understand that the AIPD will initially focus on projects in China, in line with the Chinese Government's urban sector priorities on resolving water pollution and scarcity of water under its 11th Five-Year Plan (2006-2010). I am heartened to note the strong and positive response from the Chinese government towards this initiative. The Kunming and Harbin Municipal Governments have already signed a Memorandum of Understanding (MOU) with ADB and SCE for AIPD to assist them in developing projects in municipal waste water collection and treatment, water recycling, sludge treatment and solid waste management.

Singapore's Long-Term Strategic Partnership with the ADB

10. The AIPD is an important part of the Singapore Government's larger efforts to deepen collaboration with the ADB. In March 2007, the ADB and International Enterprise Singapore (IES) launched the Asia Training and Research Initiative for Urban Management or ATRIUM in short. It is a joint collaboration to pool resources to deliver capacity development programmes supporting urban management. ATRIUM has seen encouraging successes even at this early stage. For example, ATRIUM's first official project, the Singapore-ADB-PRC forum on Urban Water and Environmental Management, garnered positive feedback from its Chinese participants.

11. The location of the AIPD in Singapore thus reflects the growing partnership between Singapore and the ADB, and our shared commitment to Asia's development. Indeed, I look forward to our continued partnership in the years ahead, building on the strong foundations that we are laying.

Conclusion

12. In conclusion, I would like to congratulate the management and staff of ADB, SCE, Crest Spring Pte Ltd, The Konzen group and United Engineers (Singapore) Pte Ltd, on the successful launch of AIPD. On behalf of the Singapore Government, I would also like to thank Dr Bindu Lohani of the ADB for taking time off to officiate the launch of AIPD.

13. With that, it only leaves me to wish all involved in this project many fruitful outcomes!

14. Thank you.

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^[1] ADB. 2006. Urbanization and Sustainability in Asia: Good Practices Approaches in Urban Region Development. Philippines.