Singapore aims to be a hub to develop bankable projects

Senior Minister of State for Finance and Law Indranee Rajah said Asia urgently needs infrastructure, given rapid urbanisation and population growth.
Senior Minister of State for Finance and Law Indranee Rajah said Asia urgently needs infrastructure, given rapid urbanisation and population growth.PHOTO: LIANHE ZAOBAO

Singapore aims to become Asia's hub for structuring and financing large-scale infrastructure projects, such as power stations, waste- and water-management systems, transport and ports.

Senior Minister of State for Finance and Law Indranee Rajah told a conference yesterday that the country is working to develop people with deep expertise in the sector.

She said Asia urgently needs infrastructure, given rapid urbanisation and population growth.

From now until 2030, the region is expected to require US$20 trillion (S$28.4 trillion) of additional infrastructure investment to meet growing demand.

"This is the equivalent of developing infrastructure needed to support the population of one Singapore every week," added Ms Indranee. She was speaking at the Asia Pacific Energy and Infrastructure Finance Forum at the Singapore Marriott Tang Plaza Hotel.

Despite "massive demand" and funds available, however, these needs are largely unmet, mainly because many projects are not bankable and hence cannot get off the ground, she said.

Bankability refers to the ability to obtain project finance.

"If a project is deemed neither bankable nor investible, it means banks will not lend and investors will not put in the money, as they cannot get back sufficient returns within a reasonable timeframe, or the risks are just too high," noted Ms Indranee.

In view of these gaps, Singapore wants to position itself as Asia's infrastructure exchange.

Its strategic location and strong position in world capital markets "make Singapore an ideal place to develop bankable projects to mobilise private sector and institutional investments", Ms Indranee said.

She added that more is being done to build up infrastructure-related skills here and get more small and medium-sized enterprises to be involved in the sector.

For instance, this year's Budget contains measures to strengthen access to cross-border project financing for Singapore-based companies that are expanding overseas.

A version of this article appeared in the print edition of The Straits Times on March 10, 2017, with the headline 'S'pore aims to be a hub to develop bankable projects'. Print Edition | Subscribe