The Ministry of Planning and Finance is preparing to launch an interactive and publicly accessible online “project bank” – priority initiatives that have been screened and approved by the government for their positive impact on economic and social development.
The initiative aims to overhaul the way in which ministries identify and tender projects, and will provide a new framework for public-private partnerships and enable the private sector to invest in state assets.
Deputy Minister for Finance and Planning U Set Aung spoke to us about the alignment of the project bank with the Myanmar Sustainable Development Plan (2018 – 2030), its likely impact on government procurement and how it dovetails with other state-led initiatives, such as the China-Myanmar Economic Corridor.
U Set Aung will also be present to deliver a session on the National Project Bank on Day 2 of the Invest Myanmar Summit.
What is the project bank and why is it being developed?
It is really important that the strategic action plans identified in the Myanmar Sustainable Development Plan (MSDP) are implemented in a proper way. The project bank is a very significant mechanism for implementing these plans.
The MSDP policy document doesn’t just contain policy directions and trajectories, it also contains policy implementation metrics, in which 251 strategic action plans have already been identified. These action plans must be further broken down into implementable projects and programmes.
How are government ministries involved in this process? What, for example, will they now have to do differently?
In the past, ministries came up with sectoral plans each year that aimed to improve their economic sectors. Now we are trying to transform these sectoral plans and systems into strategic plans and systems.
Ministries and government agencies will have to identify much more strategic projects and programmes [for inclusion in the project bank and that may be eligible for private-sector financing] that will not only improve their respective sectors but will also be aligned with the strategic actions plans identified in the MSDP.
Has the process of identifying projects already started?
The ministries have identified quite a few projects – hundreds of projects have already been submitted to us and all of these are now going through our rigorous assessment process. It is very important that all projects [in which the government is involved] go through rigorous, stringent assessments. Only those that pass will qualify to be implemented through multiple financing mechanisms. All the projects that government agencies are planning to develop, along with specific information about these projects, will be accessible to the public, enhancing transparency and predictability as the projects are developed.
How will these projects be financed?
Of these projects, some are to be implemented with the government budget and some with development assistance, so it’s going to be easier for development partners to find strategic projects that are found to be a priority for the nation.
There are also many projects that will be eligible for public-private partnerships. We will implement specific mechanisms to make these PPP projects more attractive to the private sector.
If the private sector invests in commercially viable, bankable projects, it will be a win-win solution for the government, because projects would be much more effectively developed by the private sector and at the same time, our fiscal burden can be lessened if we do it properly.
Will legacy projects that have been approved and have not yet started, or those that have stalled, be included in this process?
One of the purposes of this project bank is to find appropriate financing mechanisms. If legacy projects have found appropriate financing methods, they don’t need to be included in the project bank. However, there are strategic projects that that can still be included in this process.
How does the project bank dovetail with other initiatives such as the China-Myanmar Economic Corridor?
The China-Myanmar Economic Corridor and other initiatives are very important for us and it is imperative that the projects and programmes in these initiatives are relevant to Myanmar. That is why we are going to use the same rigorous and stringent assessment process to identify the real strategic projects that can be considered a priority before going ahead with implementation, particularly in each initiative.
So the CMEC projects will be included in the project bank?
All the projects will be included because the project identification process is really important and can be efficiently done only by quantitative and qualitative scoring systems, which are introduced in the project bank process.
We understand the private sector can also submit proposals for inclusion in the project bank. How would that work?
The private sector can come up with unsolicited proposals to implement the projects they want to develop. But it is really important that these projects go through a competitive and transparent open tender process before they are eligible for government support.
In addition to that, we have [identified] some state-owned enterprises to be included in the project bank, for their possible privatisation or equitisation, particularly to turn some state-owned enterprises into PPPs.
Will the projects in the project bank be subject to parliamentary approval?
What we hope to do is enhance the coordination among government agencies and identify whether existing projects are strategic and are a priority. We will then pool all the data so that we can enhance transparency and predictability and strengthen competitiveness through an open tender system.
All the existing systems will still apply: if parliamentary approval is required then parliamentary approval is going to be sought. If cabinet approval is required, then it will be sought.
What do you see as the major challenges to implementation?
The major challenge is to convince all the stakeholders to understand more about strategic planning. They are much more comfortable with the sectoral planning system we have been practising for decades in the past. This is a transition time, which is why we have to employ a lot of training and capacity building and [encourage a] mindset change.
When will the project bank be made available to the public and what will be the mechanisms for community engagement and public participation?
I think within a few months, we will have qualified strategic priority projects in the project bank and then we are going to start asking the private sector to participate. Since the project bank aims to enhance transparency and competitiveness, it is very important that project implementation is done in accordance with international practices.
The monitoring system is going to be enhanced and strengthened. We’ve got different systems for assessing outcomes, impact, and output, with valid indicators that have been developed. We are very optimistic about the project bank and its implementation through these systems.