They agree that while in some of the region\u2019s states further regulatory and institutional hurdles must be overcome before private finance can be enticed on a large scale, the relative lack of investment opportunities in mature economies such as the US is tipping the reward versus risk balance in favour of emerging markets.<\/p>\n
Manju Chandrasekhar, vice president \u2013 Economics & Business Solutions at port consultancy Halcrow, says the region has already attracted substantial inflows of foreign direct investment and this trend is likely to \u201cremain strong for the foreseeable near-term future\u201d.<\/p>\n
The South East Asia region has considerable historical experience of the virtues of private sector participation in the maritime and transport sector – from early developments in Singapore and successful privatisation programmes in Malaysia, through to more recent reform successes in Indonesia and Vietnam. As a result, the idea of ports as drivers of economies\u2019 export-driven growth, and of private finance and operators as a means to speed that growth, is well established.<\/p>\n
\u201cGovernments are generally eager to facilitate in the development of ports and terminals,\u201d explains Mr Chandrasekhar. \u201cThe key here is that there is a good basis of knowledge and best practices – even if to some degree through trial and error – which developing countries can draw upon in structuring their policies towards infrastructure development to address capacity constraints.<\/p>\n
\u201cWhere necessary, my sense is that governments are trying to be as little an \u2018impediment\u2019 or \u2018hindrance\u2019 as possible to allow private sector development to address these issues. Where some constraints have been encountered, these relate to government delays in delivering the public side of infrastructure development, such as environmental clearances or dredging.\u201c<\/p>\n
He says that although leading container port investors including shipping lines may not have the war-chests available to them apparent in the pre-financial crisis years, they did benefit from relatively early recovery and are now looking to strategically invest ahead of growth.<\/p>\n
\u201cPrivate equity capital is looking for projects that make sense,\u201d he adds. \u201cThe rationale is a combination of a strategy to establish a \u2018beach-head\u2019 in strategic markets, while simultaneously taking advantage of potentially lower asset valuations in the immediate aftermath of the financial crisis.\u201d<\/p>\n
A DP World spokesperson identifies Laem Chabang in Thailand and Ho Chi Minh City in Vietnam as suffering from over-supply of capacity and unlikely to be attractive for investors. \u201c<\/strong>Indonesia is, however, attractive based on its strong and developing economy which is forecast to grow stronger on the back of international investment and trade,\u201d she adds.<\/p>\n \u201cMalaysia and Cambodia are also places of potential interest given the right economic climate.\u201d<\/p>\n Mr Chandrasekhar also classifies Thailand as a \u201cmaturing\u201d market in the context of long-term growth in South East Asia and argues that in the near to medium term, the players that want an established presence in Vietnam are already in place, although he sees further room in that market for \u201ctargeted investment\u201d.<\/p>\n He adds: \u201cI think that a similar rationale applies to Indonesia, in addition to its large development potential as a bigger economy with a larger population base and the geographical reality of a country that is spread across several islands. The biggest impediment to Indonesia\u2019s ability to attract FDI remains the lack of transparency that prevails through almost every level of the public sector and government.\u201d<\/p>\n The DP World spokesperson says that governments across the region are working with stakeholders to encourage investors but further investments by DP World \u201c<\/strong>would depend on the individual country and the incentives that specific governments have in place for foreign investment\u201d.<\/p>\n She concludes that South East Asia is \u201copen to development legally and politically”, but warns, \u201cthere has to be a balance between demand for upgraded or new facilities and a return on capital for the investor\u201d.<\/p>\n","protected":false},"excerpt":{"rendered":" Investment in ports located in South East Asia\u2019s fastest growing economies will accelerate in the coming years, according to leading analysts and operators.<\/p>\n","protected":false},"author":8,"featured_media":8203,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[69],"tags":[],"sponsor":[],"class_list":["post-8202","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-asia"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/posts\/8202","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/comments?post=8202"}],"version-history":[{"count":1,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/posts\/8202\/revisions"}],"predecessor-version":[{"id":8204,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/posts\/8202\/revisions\/8204"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/media\/8203"}],"wp:attachment":[{"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/media?parent=8202"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/categories?post=8202"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/tags?post=8202"},{"taxonomy":"sponsor","embeddable":true,"href":"https:\/\/www.portstrategy.com\/greenport\/wp-json\/wp\/v2\/sponsor?post=8202"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}