Stronger policy safeguards needed for investments in heavy industries, says exec

MANILA, Philippines - The government should implement stronger policy safeguards for investments in regulated infrastructure and utilities projects, a top utility executive said.

Luis Juan B. Oreta, chief finance officer of Manila Water Corp., said the Aquino government’s Public-Private Partnership (PPP) initiative presents a lot of opportunities for investors.

However, he said government should come up with a “template” for investments and perhaps “”customize each and every template” with its partners.

Likewise, Oreta stressed the need for the government to put in place a retail tariff setting mechanism which would also ensure better rates of return for investors.

Additionally, the state should put in place mechanisms for capital recovery for the investor.

Specifically in the case of water utilities, Oreta suggested that government should delineate concession areas outside Metro Manila across more practical crossover boundaries rather the current political boundaries. Allowing crossover boundaries, he said, would allow for more efficiency.

The government will be holding a three-day PPP conference from Nov. 17 to 19 to present various infrastructure projects for joint development with potential private sector investors.