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Opening Remarks by Ambassador HK Yu PSM
at Partnerships for Infrastructure Launch in the Philippines
on 24 March 2023 at Conrad Manila
Let me start with some acknowledgments: Dr. Benjamin Diokno, Secretary of Finance; Mr. Nicholas Moore, Australian Special Envoy to Southeast Asia. We are extremely lucky to have Nicholas with us today for this very important launch. Our panelists for today's discussion, which without them, today would not have been possible. Undersecretary Catherine Fong from the Department of Finance (DOF); Undersecretary TJ Batan, a good friend from the Department of Transportation (DOTr); Ms. Cosette Canilao, President and CEO of Aboitiz InfraCapital; and Mr. Chris Allen, acting CEO of Infrastructure and Commercial Advisory Office (ICA) of the Australian Treasury; and distinguished colleagues from government, private sector, media, the international community, and ladies and gentlemen, magandang umaga po, to all of you.
I'd like to warmly welcome all of you to the official launch of the Australian Government's Partnerships for Infrastructure initiative in the Philippines. Partnerships for Infrastructure, also known as P4I, was announced in 2020 by the Australian Government at the Association of Southeast Asian Nations (ASEAN)-Australia Summit. This was in response to clear messages from our ASEAN partners that they wanted more engagement with Australia on infrastructure. This is not that surprising because for many decades we have all been in fierce agreement that infrastructure plays a crucial role in boosting economic growth and prosperity. In fact, whether post the global financial crisis, or post the pandemic, infrastructure spending and investment was often seen as a possible solution for economic recovery, and a good one because it often works on both the demand and supply side of the economy.
We have also been in fierce agreement that good infrastructure can help reduce poverty and inequality and build resilience to growing climate and natural disaster risks. We know that that's happening all around us.
But we have unfortunately also been in fierce agreement that there is a large infrastructure gap all around the world and it's growing.
It is no different in the Philippines. And in fact, the Marcos Administration highlighted investment in infrastructure as a priority as part of its Build Better More agenda. It is aiming to spend around 5 to 6 per cent of GDP over its six-year term; that is really promising. Infrastructure [is] also featured prominently, really prominently in the new Philippine Development Plan. We know how important all of this is to the Philippines.
So, Australia thought long and hard about how Australia can actually best value-add and help our partners. And in true Australian style we decided that the best way to assist was to form partnerships to share our own experiences in infrastructure investment, both good and the bad - and we've got plenty of those too and to bring people with right experts together to work on problems and issues on hand. Not one size fits all approach, but one that is tailored to each circumstance, not the one off and transactional type, but one that builds enduring relationships, and certainly not just between one country and another, but a multi-country program that brings even more experiences and techniques and skills to the table. So P4I was born.
P4I focuses currently on transport, energy, and telecommunication. It provides advisory services to critical decision makers in the early stage of the infrastructure lifecycle, namely infrastructure planning, prioritization, procurement, and financing. P4I’s initial engagement in the Philippines revealed that many government stakeholders are concerned about how to harness a range of strategies to finance its infrastructure development. And of course, that involves private sector engagement. So today's panel discussion will be themed around this.
Through P4I, Australia is partnering with the Philippine Government agencies to explore a range of financing models, including drawing from Australia's experience, but also from around the world and to very importantly build connections among Philippine and Australian government agencies. Just this week, with support from P41, we had the Australian Treasury's ICA actually commencing their important collaboration with the Philippine’s Public Private Partnership Center. They even discussed the new PPP legislation that's currently being considered by the Senate in the Philippines. And we see this very much as the first step in what will be a long-term partnership.
We know infrastructure investment requires a strong regulatory environment to manage what sometimes appears to be competing demands and objectives. The private sector definitely needs the right incentive to invest and innovate, while the government is there to ensure that the service standards are met, that assets are managed efficiently, and that infrastructure is inclusive, resilient, and sustainable. Australia has faced and it is still facing many of these challenges, and over the years with help of people like Nicholas Moore, we've developed a strong track record of constructive engagement between the public and private sectors and another really important player, the communities.
On infrastructure financing we are already working with the Philippines, in particular, the Department of Transportation to develop tools for investment prioritization and choosing the right financing and delivery strategy. P4I is already working with the Philippine Government Procurement Policy Board (GPPB) on green procurement, lifecycle costing and design and build contracts. And P4I is already working with [the] World Bank to support studies on potential connectivity projects in Mindanao. But there is more to come, how amazing is that? Over the coming months, we also see opportunities in the energy sector. We would love to work with the Philippines to further enhance your infrastructure investment in energy. This is part of the Australian government's commitment to work with the region to take action on climate change, build clean energy industries, and accelerate the energy transition that this planet is so desperate for.
In fact, just last month, P4I hosted a study tour to Australia for officials from Southeast Asia, including a big delegation from the Philippines, to explore the potential of green hydrogen, as energy storage, and in key sectors such as transport and agriculture. We hope that this tour will provide the foundation for dialogue and to explore uptake of renewable energy further. Through the World Bank, P4I is funding studies to look at options for off grid electrification and energy efficiency. Through all this work, P4I exemplifies Australia's deepening and enduring friendship with the Philippines and our commitment to the growth of the Philippines. Why, you ask? It's because Australia and the Philippines are true friends and partners, and good neighbors. And it is absolutely in Australia's interest that we have a strong, resilient and prosperous Philippines for the peace, stability and prosperity of the region that we live in.
With that, salamat, everyone.