WASHINGTON - Singapore and the United States will work together to promote infrastructure development and investment in Asia under an agreement inked on Wednesday (March 20).
The agreement signals the development of more options for infrastructure financing for Asian countries, in addition to China's Belt and Road Initiative (BRI) and a trilateral partnership between the US, Australia and Japan to mobilise investment in infrastructure projects in the region.
Asean has been working to attract more private investment to fund its massive development needs, as the Asian Development Bank estimates that South-east Asian countries will need US$210 billion (S$284 billion) a year over the next decade for their infrastructure needs.
The Memorandum of Understanding was signed during Minister for Trade and Industry Chan Chun Sing's introductory visit to Washington DC.
It will see Singapore and America's infrastructure agencies working together to encourage businesses to invest in developing infrastructure in Asia.
Singapore's Infrastructure Asia agency plays the role of an investment broker connecting investors and infrastructure development projects, and likewise, America's development finance agency, the Overseas Private Investment Corporation (Opic), helps US businesses invest in emerging markets.
Both countries will work together on information sharing, deal facilitation, structuring and capacity building schemes in sectors of mutual interest such as energy, natural resource management, water, waste, transportation and urban development, the Ministry of Trade and Industry (MTI) said in a statement.
Through the agreement, US companies investing in infrastructure development in the region can make better use of Singapore's developers, financiers and professional services and its understanding of regional markets, added MTI.
Singapore and the US can also cooperate in annual project discussions or sessions to gauge market interest in Singapore on topics such as power, water, transport and urban solutions.
Both sides could also discuss projects that will tap the expertise of companies, including American companies based in Singapore, added MTI.
Singapore, which positions itself as an infrastructure hub in Asia, has been heavily involved in various infrastructure financing schemes in the region, including the BRI.
Singapore and China signed an agreement last year to promote greater collaboration between their companies in third-party markets along the Belt and Road.
In recent years, the US has criticised the BRI loans as debt traps for poor countries, touted itself as a better option for developing countries seeking infrastructure funds, and beefed up Opic by doubling its investment cap from US$30 billion to US$60 billion.
Welcoming the agreement with Singapore, US-Asean Business Council president Alexander Feldman said in a statement: "This agreement will help ensure American companies identify and contribute to the infrastructure required to achieve an economically integrated Asean marketplace."