MPAC faces both challenges and opportunities in developing infrastructure through public-private partnerships (PPPs). Several Southeast Asian countries have established PPP units and regulatory frameworks, but challenges remain around institutional fragmentation, unclear procedures, and foreign ownership restrictions of land. Cross-border infrastructure projects offer opportunities for large-scale development but require navigating multiple authorities. While countries like Malaysia and Singapore have more streamlined PPP processes, others would benefit from reducing uncertainty and establishing clearer timelines and project valuation guidelines to better facilitate private sector participation in infrastructure development through PPPs.

1. MPAC: CHALLENGES AND
OPPORTUNITY
Fauziah Zen
Economist of ERIA and University of Indonesia
Singapore Chamber of Commerce Luncheon Talk
30 October 2014
Grand Hyatt, Jakarta

2. Infrastructure as key of growth
2/18/2015
Source: World Economic Forum Report 2013-2014
0
1
2
3
4
5
6
7
Singapore
M
alaysia
Brunei
Thailand
Lao PDR
Indonesia
Cambodia
Philippines
Vietnam
M
yanmar
Overall quality of infrastructure

3. Ease of Doing Business (2015)
Source: World Bank, 2015

4. PPP Regulatory Framework
Philippines.
Indonesia,
Thailand
Malaysia,
Singapore
Vietnam
Brunei,
Cambodia,
Laos,
Myanmar
Certainty
Uncertainty
Specific
Law
Unspecific
Law

5. PPP Institutional Setting
Country Leading Unit Concurrent tasks Fragmented tasks
Malaysia UKAS (P3U –
PPP Unit)
Philippines PPP Centre Line Dept.
Indonesia MOF Bappenas, CMEA, BKPM
Singapore MOF PPP Advisory Council
Thailand State Enterprise Policy Office, MOF
Brunei Department of Economic Planning and
Development, Brunei Econ. Dev. Board and
MOF
Cambodia MEF, Council for Dev. of Cambodia,
Min. of Commerce
Lao PDR Min. of Planning and Investment,
MOF
Myanmar MNPED, Myanmar Inv.
Commission

6. Procedures
Country Streamline Process Main Challenges
Malaysia ++
Philippines ++ Needs multi-agency approval, risk allocation problems
Indonesia + Timeline, land clearing
Singapore +++
Thailand + Unclear proj. valuation, support, definition, timeline
Brunei ? No example
Vietnam ? Macroeconomic challenges, policy changes
Cambodia ? Specific favorable sector (energy), unclear proc., no
gov’t support
Lao PDR ? Incomplete guides (underdevelopment), no gov’t
support.
Myanmar ? Timeline, unclear proc., no gov’t support

7. Cross-border Projects
•Very long process•Needs international
experience
•Showcase
•Dealing with multi
authorities
•Complex
•Large scale projects
•Supported by
international
org./development banks
•Growing future markets
Advantages Challenges
CaveatOpportunities

8. Foreign Ownership for Lands and Buildings
Country Foreign Ownership
Malaysia No restriction for foreigners, except for: Malay Reserve Land, Real estate< RM500,000 per unit, Low cost houses, Real
estate reserved by state authority for bumiputera interest.
Philippines The 1987 Constitution: Corporations (>60% of whose capital is owned by citizens) may acquire private lands, cannot
own public land and can only hold the same by way of lease.
Indonesia Right to own land is limited to citizens and certain legal entities. Foreign & domestic companies may hold the Right to
Build (HGB); Land Cultivation Rights Title (HGU); and, Right to Use (HP). Most foreign companies hold HGB to construct
& own buildings on land for max 80 years, and could be sold, transferred, or encumbered by a mortgage.
Singapore Two types of land tenure: freehold, leasehold. The freehold under GFS is absolute title whereas SLG is subject to the
terms under States Act. The leasehold is mainly 30, 60, 99 and 999 years period and is under the agreement with
landlord or the State.
Private sector in some of the PPP projects, obtains land through sub-lease contract with a government body with a head
lease between the body and the Singapore Land Authority
Thailand "Thai citizens are allowed to own immovable assets while foreigners are able to obtain ownership for land and buildings
under conditions specify in the Land Law, Private, Commonly-owned Housing Act, Investment Promotion Act and
Industrial Estate Authority of Thailand Act.
The Land Code generally prohibits the ownership of land by foreigners in Thailand, except that they are authorized by the
Board of Investment (BOI). However, the Condominium Act allows some foreigners to own condominium if they meet one
of five criteria: 1) Foreigner who hold a residence permit, 2) Foreigner who bring the entire purchase price from aboard in
a foreign currency, 3) Foreigner permitted to enter Thailand under the Investment Promotion Act, 4) Juristic person
having some land rights as foreigners as provided in the Land Code, 5) Juristic person having BOI privileges in Thailand."

9. Foreign Ownership for Lands and Buildings
Brunei Land ownership only for citizens. Locally incorporated/registered companies may be a lessee of up to 60 years over an
industrial/commercial property, and may obtain temporary occupation permit of state land for industrial or agricultural
purposes.
Cambodia Land ownership for QIP (Qualified Investment Project) Cambodian citizens and entities only. The use of land shall be
permitted to investor, including concessions, unlimited long-term leases and limited renewable short-term leases.
Lao PDR Ownership of land belongs exclusively to the nation and is not granted even to the citizens. Foreign investors are entitled
to buy land use rights from the Government according to a certain limit and procedure. Investors who wish to use
government-owned land must apply for a concession and then obtain approval by the prime minister or the Council of
Ministers.
Myanmar Foreign investors not allowed to purchase land, may obtain usufruct rights by leasing from the government or by forming
a joint venture with a government agency. Under the New Investment Law investors may lease lands both from private
entity/person as well as the government with permission of the MIC. Lease term can be 50 years and application for 10-
year extension may be granted twice (70 years in total) to the foreign investors.
Vietnam Land is public property. The State will allocate or lease land to individual or organization. Holding the Certificate of Land
Use Right (CLUR) is the evidence of registration of the Land Use Right. Assets attached to land is acknowledged in the
CLUR and the owner registers its ownership of assets in accordance with the provisions of the laws on registration of
immovable assets and is issued Certificate of Ownership of Construction Works (COCW). Ministry of Natural Resources
and Environment is the body to issue the CLUR. Foreign invested organizations established under the laws of Vietnam
are entitled to be issued CLUR and COCW. Foreign organizations established under foreign laws are not given the
CLUR and COCW.
Source: ERIA, 2014

10. THANK YOU
fauziah.zen@eria.org