How Public-Private Partnership Is Building A New Smart City in the Philippines
Video | 13 December 2019
New Clark City is one of the most important large-scale infrastructure projects in the Philippines’ recent history. It is envisioned to be a benchmark livable, environmentally sustainable, and resilient city not only in the country but also in Asia. ADB's Office of the Public-Private Partnership provided transaction advisory services to ensure transparency and swiftness of the project. Considered as a model public-private partnership (PPP), New Clark City demonstrates how PPP can help build Asia's massive infrastructure needs.
Manila, Philippines – Manila is one of Asia's most congested cities. This makes it hard for workers to get to jobs and businesses to reach customers. So Manila is missing out on the benefits urbanization can bring. Floods and earthquakes are a constant threats to people and infrastructure.
But 100 kilometers north of Manila a former military base is being transformed into a smart, efficient, and climate-resilient city.
New Clark City will provide a modern, livable space for more than one million people, easing pressure on Manila.
"There really needs to be a redirection in how we plan and we develop these cities. The main mandate of BCDA was really to try and convert the former US military bases into new centers of growth. And in particular, Clark was really envisioned to become a new city, a major metropolis of the country. With the help of the Asian Development Bank, who was critical especially in the first phase of the New Clark City, we can really build a green-filled metropolis that is well-planned and that will be truly green, smart, and disaster-resilient but at the same time also very inclusive. And it was done in such transparency and openness that it’s really a model PPP," shares Vince Dizon, CEO and President of Bases Conversion and Development Authority.
Developed under a public-private partnership (PPP) program, the New Clark City will span nearly 10,000 hectares. It is designed to be the first smart, environmentally sustainable, and climate-resilient city in the Philippines.
Transaction advisory services provided by ADB's Office of the Public-Private Partnership helped deliver critical infrastructure.
"BCDA asked us to review the New Clark City masterplan. The first unsolicited proposal was to build this National Government Administrative Center. Subsequently the government decided to bid for the SEA games, so they added the sports facilities. After that we helped BCDA with the procurement of water and wastewater PPP and the power distribution PPP. Now we are helping BCDA work on a mass transportation system and the PPP for information and communications technology," recounts Catherine Lopez Fong, Senior Public-Private Partnership Officer, Asian Development Bank.
The smart city features and technology are expected to attract both investors and residents. The National Government Administrative Center will serve as a recovery zone if a natural disaster hits Manila. When completed, New Clark City will help decongest Manila.
"In our list of 100 flagship projects, there are about 26, about one-fourth of that list are PPPs. New Clark City is also a combination of ODA (Official Development Assistance), government money, and private sector participation. I think the blending of these three sources is just right because of its strengths. Eventually, it’s the people who will be benefitting," explains Ernesto Pernia, Director General of National Economic and Development Authority of the Philippines.
New Clark City is one of the most important large-scale infrastructure projects in the Philippines’ recent history. With extensive experience in PPPs, ADB can help countries in Asia to use this financing method to build the infrastructure they need.
"The infrastructure needs of Asia and the Pacific amount to over $1.7 million dollars. The government can only bridge 40% of the gap amount and the other 60% must come from the private sector. OPPP’s main function is advisory service not lending. OPPP focuses on providing transactional advisory and project preparation to support our public sector create and structure commercially viable PPP projects. I am quite confident that we can play a big role to bridge the need of public centers and private partners," points out Yoji Morishita, Head of ADB's Office of Public-Private Partnership.