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Emerging Stronger: Healthy and Sustainable Infrastructure

 17 Jul 2020
 4.00 pm – 4.50 pm, GMT+8 
Zoom
2 SIP CPD Pts, 1 PEB PDUs
BOA-SIA members: no lectures or webinars will award CPD points this year as CPD requirements are waived

Synopsis

The COVID-19 pandemic has disrupted many cities’ infrastructure plans and projects. At the same time, clearer skies and cleaner air since the lockdowns have also revealed that cities are key to better environments. How can cities bounce back from this crisis stronger, healthier and cleaner? How can they design and structure investments to insure them against continued uncertainty, and what are some best practices of development measures and approaches that would ensure the success of their projects?

At this webinar, Indranee Rajah, Minister in the Singapore’s Prime Minister’s Office, Second Minister for Finance and Education, will open the discussion with a keynote on how cities can emerge stronger from this pandemic by investing in sustainable infrastructure to enhance a city’s health.

Resources

Slides by Mr Loh Ah Tuan (PDF: 620KB)

Slides by Mr Pang Yee Ean (PDF: 1.5MB)

Webinar Video

Key Takeaways

As cities prioritise health, infrastructure is a bright spot
Prior to Covid-19, many cities already lacked the infrastructure to provide their fast-growing populations with a good living environment. In Asia, Minister Indranee Rajah said 1.5 billion people lack basic sanitation, while Mr Loh Ah Tuan had observed poor waste management and uncollected rubbish piling up in many Asian cities. Mr Pang Yee Ean cited a 2019 World Health Organisation report, which said two billion people lacked clean water. A lack of clean energy also undercut cities’ health and sustainability. “These gaps have to be addressed,” said Minister Indranee.

Mr Pang proposed three reasons why cities have long struggled to deliver solutions. (1) ‘Unsustainable old ways’, like open landfill burning or groundwater dependence, are hard to eradicate because they appear very cheap. (2) The ‘Irony of Essentials’ is that because governments feel compelled to provide essentials like water free or at very lost cost, such infrastructure tends to deteriorate over time as it is inadequately funded. (3) ‘Municipal traps’ refers to typical challenges that municipalities face: limited revenue capabilities; different priorities; and limited capacity, talent and leadership to effect fundamental change.

However, amidst the current economic gloom, Minister Indranee called infrastructure “a bright spot,” contributing to countries’ long-term growth, promoting business activity, and creating jobs. Covid-19 had “demonstrated the importance of cities’ infrastructure for public health” like water, sanitation and waste disposal, she said, while lockdown-induced cleaner air and clearer skies encouraged cities to prioritise a cleaner environment. Moderator Seth Tan noted that despite the pandemic, the total volume of infrastructure project finance deals done in Asia has not slowed, albeit loan sizes have been falling. Given the current volatile context, Mr Pang said bite-sized projects were more manageable, and so would continue.

Money is not the problem, but is technology alone the solution?
“In my career of investing,” said Mr Pang, “at even the worst of times in ’06, ‘07 or ’08, there wasn't a shortage of money. There is always a shortage of good projects. It is amazing.” He added there are four to five dollars of investment money for every dollar worth of projects in the market. Minister Indranee and Mr Loh echoed the point that a shortage of well-prepared projects rather than funds was what held back the delivery of more infrastructure projects.

On technology, Mr Pang observed that the cost of solar photovoltaic (PV) panels had fallen to just 15% of their past price over eight years, and the cost electricity produced had fallen from 20 US cents per kilowatt hour, but to 3 cents. Beyond costs, “with policy support and countries imitating each other”, solar PV is multiplying quickly in Asia, and he said something similar was happening with desalination. Indeed, Minister Indranee had said technology was driving down reverse osmosis costs. She also highlighted another way that technology was impacting infrastructure: sensors that detect leaks in water supply pipelines helped to make projects more economically viable while maintaining affordable water tariffs.

Mr Loh sounded a note of caution on technology. He recounted how, when dealing with inherited waste management problems, many city managers said “I want technology!” Mr Loh’s response was “technology is good, but technology will not solve your problem. You require a system. The system is governance.” He advised patience and the need to consider human attitudes by recalling his experiences in the 1960s and 1970s in Singapore. “I despaired as a young engineer. My director told me ‘go and sort out the solid waste problem’. I said ‘how?’ Slowly. You look at it, you analyse it. And it boils down to people's attitude, whether in the civil service, in the private sector, or in the community.”

All speakers agreed that in order to deploy an infrastructure project, cities needed more than a technical solution and the money to pay for it. They needed a systems approach to developing properly structured, well-prepared projects that would succeed.

Emerging Stronger: how do we get there?
Mr Loh said cities should develop a comprehensive infrastructure master plan - a “top-line overview” of what a government needed to do over a 20 to 50 year timeframe, setting out the broad mission, direction, and strategy. Roadmaps are then needed for infrastructure projects over a 5 to 10 year period, and should include the project execution model, be it EPC (Engineering Procurement Construction), PPP (Private Public Partnership), or other models. Roadmaps also outline the project structure and should involve the whole of government, not just a single agency, as it involves financing, technical regulation, etc. An infrastructure master plan and roadmap should likewise be integrated with the city master plan. Such preparation builds confidence in private sector participants as well as the community, and help them to assess the risk of projects and boost community morale.

Mr Pang felt there is “a role for everyone”. Besides city officials, financiers and technical experts, projects also needed lawyers, as well as consultants to advise on how to structure and prepare projects properly. Mr Loh added that, for any particular project, cities may engage all sorts of consultants to produce reports that help to make projects bankable. However, he said, when “I look at some of these proposals… I'm not a banker but I will not approve them, because where's the sustainability? Where is the big picture?” He suggested that cities would do well to also engage a high-level strategic advisor would be able to review and advise on the entire system of governance.

Last but not least, speakers discussed newer financing possibilities for cities. Minister Indranee said that, with resources diverted to COVID-19 recovery efforts, “alternative funding sources may also become more important.”  Besides funding from municipalities or multilateral development banks (MDBs), newer combinations of financing and tools could comprise (1) working with MDBs to develop newer ways of guaranteeing projects to increase investability; (2) increasing access to social funds; and (3) adopting new technologies to increase commercial viability. Mr Pang said that while historically many municipalities had not been very strong in investing in public health infrastructure, and the private sector had preferred to invest in sectors like energy or roads, “the good news is, I see increasing interventions from central governments, multilaterals, and NGOs.” For example, NGOs like the Gates Foundation, and Abu Dhabi Fund for Development are investing in public health infrastructure. He also cited an example where the Philippine central government commissioned a study of waste generated by 140 municipalities, in order to figure out how to manage that waste, and which he believed would result in more waste treatment, or waste-to-energy plants coming out. “Expect the decade of greater private sector participation in public health infrastructure,” he said.

About the Speakers

KEYNOTE SPEAKER
Minister Indranee Rajah
Minister in the Prime Minister’s Office
Second Minister for Finance and Education

Ms Indranee Rajah is the Minister in the Prime Minister’s Office. She is also Second Minister for Finance and Education. Ms Rajah has been the Member of Parliament for the Tanjong Pagar Group Representation Constituency (GRC) since 2001. She was in practice as a lawyer and Senior Counsel before joining Government. Under her MOF portfolio, Ms Rajah co-chaired the Working Group on Legal and Accounting Services. As Second Minister for Education, Ms Rajah currently chairs UPLIFT – the “Uplifting Pupils in Life and Inspiring Families Taskforce”, an inter-agency team convened in 2018 aimed at strengthening support for students from disadvantaged families.

 

GUEST MODERATOR
Seth Tan
Executive Director
Infrastructure Asia

Seth is the Executive Director of Infrastructure Asia, a project facilitation office under the Singapore government. Set up by Enterprise Singapore and the Monetary Authority of Singapore, the office aims to harness the network and collective capabilities of public sector agencies and private sector firms, and partner stakeholders across the region to meet Asia’s infrastructure needs. Prior to this, he has helmed leadership roles in DBS Bank, BNP Paribas, Standard Bank, and Babcock & Brown, and was based overseas in China, Australia, Hong Kong. Over his 23 years involvement in the infrastructure sector, he has worked on various opportunities across various infrastructure sub-segments.

 

 

PANELLIST
Loh Ah Tuan
Former Director-General and DCEO
National Environment Agency

Loh Ah Tuan joined Singapore’s Ministry of the Environment & Water Resources 40 years ago, retiring in 2007. He was Director-General/Deputy CEO of the National Environment Agency, with portfolios in environmental planning, pollution control, integrated solid waste management, wastewater treatment and environmental public health. He was instrumental in ensuring Singapore enjoys clean air, water and land, and high standards of public health.

Since his retirement, Ah Tuan has provided consultancy services in environmental planning and infrastructure development to several private companies and governments. He is a member of the Centre for Liveable Cities’ Panel of Experts and an Advisor of M&Y Singapore City Advisory Centre.

 

 

PANELLIST
Pang Yee Ean
CEO, Surbana Jurong Capital

Yee Ean is CEO of Surbana Jurong Capital, an investment platform of Surbana Jurong Group that focuses on financing of infrastructure and urban development.

Prior to this, Yee Ean was Director General of Investment Operations in AIIB, where he strategically identified and executed infrastructure investments in Asia. He also held various senior positions at Ascendas, including Senior Vice President in charge of Real Estates Funds where he co-led the SGX listing of a S$700 million market value Ascendas Hospitality Trust, and Assistant CEO of Ascendas Services Pte Ltd, where he oversaw the asset management of Ascendas’ industrial and commercial developments in both listed and non-listed entities in Singapore.

 

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