ADB, AIM hold forum on finance and risk mitigation

Participants in the Asia Finance and Risk Mitigation Forum listen to the keynote speech of Finance Secretary Cesar V. Purisima.

The Asian Development Bank (ADB) partnered with the Asian Institute of Management (AIM) through the AIM Gov. Jose B. Fernandez Jr. Center for Banking and Finance for the Asia Finance and Risk Mitigation Forum 2012: Catalyzing Private Capital for Investment and Trade in Developing Asia. The event was held at the AIM Conference Center last April 30.

Department of Finance Secretary Cesar V. Purisima delivered the keynote message. He stressed that while the administration of President Noynoy Aquino has laid the groundwork to facilitate investments in the country, particularly in the infrastructure and tourism sectors, the underpinning to all the government’s current initiatives and programs is good governance. He said good governance is the differentiating factor that will attract investments and make project implementation in the country effective.

The forum brought in more than 30 moderators and panelists from Asia, Europe, and USA who discussed the following topics:

• institutional and regulatory challenges facing lenders and guarantors
• using credit enhancement products to catalyze private capital for investment in infrastructure
• financing infrastructure in national currencies
• innovative financing and guarantee structures in developing Asia, and
• how risk transfer products are creating new partnerships and opportunities for public and private institutions.

AIM president Edilberto C. de Jesús delivered the welcome remarks. He noted that with the diversity in Asia, the investment and trade policies in the region’s economies vary. He said there cannot be a template for development, as the economies in the region start from different points at different rates, and operate under different structures and systems.

Dr. Edilberto de Jesus

Dr. de Jesús added that private capital plays a critical role, since no government by itself can afford to pay the cost of development without going broke. According to an ADB study, Asia would need at least $750 billion in investment each year up to 2020 to finance infrastructure alone, and bulk of this would be private capital. The challenge, according to Dr. de Jesús, would be “to identify the appropriate business models in order to catalyze private capital for investment and trade.”

In a panel session, Dr. Roberto F. de Ocampo, executive director of the Gov. Jose B. Fernandez Jr. Center for Banking and Finance and former Philippine Finance Secretary, said that the current public-private partnership (PPP) model is essentially the build-operate-transfer (BOT) and its variants. Citing the need for more investments in infrastructure facilities, he emphasized that private investments should not be given a blanket guarantee. He further cited the need to build the institutional capacities of government agencies in implementing and regulating projects under the PPP or BOT models.

Dr. Roberto de Ocampo

The forum drew more than 350 project developers, exporters, insurance underwriters and brokers, and executives from banks, financial institutions, law firms, financial consulting and accounting firms, development finance institutions, export-import banks, and international and government agencies.

The forum was also made possible through the support of the Global Network of Exim Banks and Development Finance Institutions, International Project Finance Association, US-ASEAN Business Council, Inc., and Berne Union.

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