Strategic Infrastructure Investment Leads To Foundation For Long Term Economic Growth

From Ahmad Shukran Shaharudin ST JULIAN'S (Malta), Nov 26 (Bernama) -- Strategic investment in infrastructure leads to the building of a foundation for long-term economic growth, said Malaysia's Chief Secretary to the Government Dr Ali Hamsa. He said, Malaysia as such, has always believed in the role of public-private partnerships (PPPs) in infrastructure development to promote the growth and development of the country’s economy. "Investing in infrastructure is the right way forward for an economy built to last. Infrastructure investment should not only be viewed as an economic stimulant, but as also a strategy. "In this regard, Malaysia’s approach is 'private sector-led growth with the government as enabler'. "Private sector interest can only be sustained as long as there are attractive profits to be made," he said at the Commonwealth Business Forum 2015, themed, "Investing in Infrastructure:Building for the Long Term", here. Ali said, however, careful consideration, assessment and review was needed to get the best value for money for the government. He said the PPP initiative should also allow reasonable returns for the private sector due to the complex nature of PPP projects in terms of risk allocation, contract negotiation, statement of needs and the key performance indicators (KPIs) related to design, construction, maintenance and services rendered. He added that as of June 2015, Malaysia had successfully implemented 698 PPP projects in which the government saved a total of US$50.21 billion (RM211.3 billion), namely total capital expenditure of US$46.49 billion (RM195.65 billion), total operating expenditure (RM9.25 billion per annum) and total proceeds from sale of government equity and assets (RM6.5 billion). (US$1 = RM4.20) "The government has eliminated 113,487 jobs from the payroll," he said, in sharing the Malaysian experience with the business fraternity from all over the world at the two-day forum. According to Ali, among the major PPP infrastructure projects recently launched or in the pipeline were the Pan-Borneo Highway, undertaken through a smart partnership between the private and public sectors by way of a project delivery partner approach, and the Kuala Lumpur-Singapore High Speed Rail project. The HSR project is anticipated to be a game-changing infrastructure project not only for Malaysia, but the region. The PPP is a smart partnership arrangement between the government and private sector for the purpose of providing public infrastructure, community facilities and related services. It is characterised by the sharing of investment, risks, responsibility and reward between the partners. It has been over 30 years since Malaysia began focusing on the PPP and launched its Malaysian Incorporated Policy and Privatisation Masterplan which evolved and resulted in the creation of the Public-Private Partnership Unit under the Prime Minister’s Department (UKAS) in 2009 to further strengthen the implementation of PPPs in Malaysia. (photoBERNAMA) -- BERNAMA