As a leading financial centre, Singapore is uniquely placed to address the problems involved in financing infrastructure projects in Asia, Senior Minister of State for Law Indranee Rajah said yesterday when she explained the role of the Infrastructure Office which will be opened in October.
In the next 15 years, an estimated US$26 trillion (S$34 trillion) may be spent on infrastructure projects in Asia, she noted during the debate on her ministry's budget.
"Many of such projects are looking for financing, and financiers are looking for projects to fund... But the projects are unable to obtain financing due to lack of bankability, usually occasioned by the lack of proper project preparation, project structuring, and technical issues."
This is where Singapore comes in.
Ms Indranee said Singapore-based banks have provided loans or financial advisory services for an estimated 60 per cent of infrastructure projects in Asean.
Also located here are commercial banks with project finance teams and project structuring expertise; multilateral development banks; and professional services companies, from law firms to engineering consultancies.
Minister for Trade and Industry (Industry) S. Iswaran cited Asia's infrastructure growth as an opportunity that cuts across multiple sectors, including financial services, professional services, precision engineering and construction.
The Infrastructure Office aims to deepen understanding of the project pipeline, promote collaboration between foreign and local companies across the entire infrastructure value chain, and facilitate projects, he said.
Estimated percentage of infrastructure projects in Asean that have received loans or financial advisory services from Singapore-based banks
Set up by Enterprise Singapore and the Monetary Authority of Singapore, it will tap agencies such as the Economic Development Board and the Professional Services Programme Office.