, Singapore

New government agency to mobilise SEA infra capital

'Infrastructure Asia' will help connect supply and demand for infra projects.

The government is planning to launch a new agency that will see it playing a big role in Southeast Asia's infrastructure drive as it works to connect the 'supply and demand' for such projects, second minister for finance Indranee Rajah said in a Bloomberg interview.

Singapore will help spur investments by structuring projects to make them more 'bankable,' Rajah added. “So you need to mobilise capital, you need to connect the demand and supply and make the projects bankable.”

China's massive connectivity project in the Belt & Road Initiative highlights the demand for such project and countries with large infrastructure requirements need to be 'bankable.'

Also read: Singapore most needed by China for its Belt & Road Initiative

She notes that the glaring gap that developing economies in Asia spend on infrastructure projects as estimates from the Asian Development Bank state that the region needs about US$26t in infrastructure projects until 2030 or US$1.7t a year. Rajah said that around US$880b is being spent on an annual basis. 

“So if you’re able to structure it right such that the income stream, the revenue that comes in, enables you to pay off your loan or whatever financing you’ve taken, then the project will be fine and it’s win-win for all,” she said. 

Here’s more from Bloomberg.

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