Asia is projected to require US$20 trillion (S$27 trillion) of infrastructure investments by 2030.12 There is great potential for you to expand your business to tap into growth opportunities in this huge market.
Countries such as Indonesia, the Philippines and Vietnam are using public-private partnership models to finance their infrastructure development. This opens up the market to private investors from local and overseas, and provides a window of opportunity for you to partner local consortiums to enter the overseas market.
12: US$20 trillion Infra Needed Across Asia by 2030, Claims A Report by Collier Report”, Track2Realty, 3 October 2018
Indonesia has the biggest population and fastest urbanisation rate in Southeast Asia. It has identified 265 infrastructure projects worth US$327 billion (S$441.5 billion) from 2016 to 202013. Business reforms are underway to attract foreign investment and the private sector to take on the majority of these projects. Foreign companies can also team up with Indonesia’s state-owned enterprises, such as construction company Waskita Karya, in public-private-partnership projects.
An area to consider is low-cost housing. Indonesia’s rapid urbanisation rates have resulted in the most acute housing shortage in Asia, especially in low-cost housing for the lower-income. The housing shortage in Indonesia was reported to have reached 11.4 million units in 201514. To fill this gap, Indonesia targets to build 10 million houses for low-income workers by 2019.
If your company is into off-site precasting, prefabrication of building components or modular construction, Indonesia is a market to consider. Developers and suppliers can explore affordable housing projects in North Jakarta (Muara Baru), West Jakarta (Daan Mogot) and East Jakarta (Pulo Gebang, West Jatinegara and Komarudin), as well as Kendal Industrial Park in Semarang.
Find out how your company can enter the Indonesian market.
13: “Indonesia Needs $157 Billion for Infrastructure Plan”, Bloomberg, 26 January 2018
14: Indonesia Central Bureau of Statistics
The Philippines launched a US$180 billion (S$243 billion) “Build, Build, Build (BBB)” infrastructure programme in 2017. The BBB programme has earmarked 75 flagship projects including six airports, nine railways, four seaports, as well as improvements to roads, bridges and bus services. These aim to improve the connectivity between rural and urban regions, create more jobs, and ease the movement of traffic and goods15.
You can help to unlock the Philippines’ urbanisation potential through township, business park and industrial park development, by collaborating with local companies under their Public-Private-Partnership programme. There have been successful projects, such as the development of urban areas like Bonifacio Global City in Metro Manila and the Iloilo Business Park in the Visayas island.
As ASEAN heads towards becoming the world’s fourth largest energy consumer by 203016, the Philippines projects that it will require 43 GW of additional capacity by 204017.
To ensure affordable, reliable, and sustainable energy to meet growing demand for power, the energy infrastructure market in the Philippines is opening up to foreign investment. This is evident from the successful issue of a US$225 million (S$303.8 million) green bond by AP Renewables Incorporated, a subsidiary of a major power developer AboitizPower Corp in the Philippines, to finance the building of geothermal energy facilities.
Check out the potential of the Philippines.
15: “Indonesia Needs $157 Billion for Infrastructure Plan”, Bloomberg, 26 January 2018
16: “Seizing Opportunity in Southeast Asia’s Energy Market”, Forbes, 20 August 2018
17: Department of Energy, Republic of the Philippines
Vietnam is one of Southeast Asia’s fastest growing markets today, and rapid urbanisation has put pressure on its infrastructure.
Vietnam has many infrastructure development opportunities you can consider, such as Lach Huyen International Gateway Port – the first major port located in Northern Vietnam. There are also plans to expand the seven Vietnam-Singapore Industrial Park (VSIP) by another 1,500ha18.
You can also look forward to more opportunities for public-private partnerships with Vietnam’s state-owned enterprises. Many of the state-owned enterprises in the infrastructure sector have become publicly-listed corporations after economic reforms. This opens up the sector to competition from foreign infrastructure players which now have a more level playing field.
Vietnam has changed its investment and real estate law to make it easier for foreign investors to buy land and buildings. This paves the way for you to develop high-rise residential properties and retirement villages for the increasingly affluent Vietnamese. Explore development sites in the biggest cities which still have much space for high-value projects or second-line Vietnamese cities that promise good value, especially those with high tourism potential.
Learn how you can unlock your business’ growth potential in Vietnam.
18: “VSIP Celebrates 20 Years of Success”, Vietnam Investment Review, 14 September 2016
India plans to invest more than US$1 trillion (S$1.4 trillion) in urban infrastructure, ports and the power sector by 2020. Its construction sector is projected to grow at 8.1% per year for the next decade.19
India is actively inviting foreign firms to contribute to its infrastructure development. Several of Singapore’s big players in the built environment industry have made inroads in India. Their track record paves the way for other Singapore companies to enter the Indian market.
One such example is Singapore’s involvement in masterplanning and developing India’s new capital city of Amaravati in Andhra Pradesh. Surbana Jurong was invited to masterplan the greenfield city. Next, a large Singapore consortium led by master developers Ascendas-Singbridge and Sembcorp Development will implement the plans, with other Singapore companies providing complementary niche solutions and peripheral services. When completed, Amaravati will be ten times the size of Singapore. The entire construction is estimated at S$21.8 billion.20
India also has plans to upgrade 500 cities under its Atal Mission for Rejuvenation and Urban Transformation (AMRUT) programme. Households in these cities can look forward to basic services such as piped water, sewerage systems, urban transport and other amenities in the cities. Singapore companies are well-placed to support India’s township development.
India is wooing foreign investment to help it achieve its Smart Cities Mission. Launched in 2015, India wants to modernise 99 Indian cities and their satellite towns, and transform them into future-ready smart cities.
With S$40.4 billion worth of projects planned in these cities, this is an attractive opportunity for you to pitch your expertise in transport, utilities, urban development and e-governance to the Indian market.
Find out more about the smart cities scene in India and how you can seize the opportunities there.
19: “India, New Engine of Global Construction”, World Build India
20: “Singapore Consortium Appointed Master Developer for Andhra Pradesh’s New Capital City”, The Straits Times, 15 May 2017