PPP mode proposed for LGU infra projects

MANILA, Philippines - The Public-Private Partnership (PPP) Center is urging local government units (LGUs) to consider the PPP mode as a viable option in implementing their infrastructure projects.

The center signed recently with the League of Cities (LCP) of the Philippines a memorandum of understanding (MOU) for the provision of assistance to LGUs in implementing projects via the PPP route.

PPP Center was represented by its executive director Ferdinand Pecson while LCP was represented by its national president Edgardo Pamintuan.

“PPP is one of the pillars of the administration’s infrastructure strategy. What we need to do is come up with more projects from LGUs through the PPP route,” Pecson said in a statement.

“We welcome this collaboration between the PPP Center and the League of Cities of the Philippines as our partners in PPPs,” he added.

Pamintuan welcomed the strategy but stressed the importance of building awareness among LGUs on how PPPs could be used in developmental strategy.

“Educate us more on PPPs, and we will educate fellow city members,” he was quoted in the statement.

The center said the MOU with the LCP is part of a larger project to establish a protocol for stakeholder engagement for local PPP projects.

Pecson said stakeholder consultation is done to solicit inputs and suggestions from LGUs in improving PPP implementation in the localities and help address problems encountered by the LGUs.

“The PPP Center is very much behind the League of Cities in their pursuit of development through infrastructure projects, specifically through PPPs. The upcoming consultation will further boost this partnership,” he said.

At the national level, PPP is shunned in favor of project financing using official development assistance (ODA) loans and funding from multilateral development banks (MDBs).

A so-called hybrid financing mode for large projects is also being considered, meaning a combination of ODA loan proceeds and loans from MDBs.

In terms of implementation, the national government has expressed preference for a so-called hybrid PPPs in which the government would build the hard infrastructure while the operations and maintenance component would be bid out to the private sector.