ABAC Infrastructure Initiatives Under the FMP

Transcription

1 2016/SFOM14/005 Session 3 ABAC Infrastructure Initiatives Under the FMP Purpose: Information Submitted by: APEC Business Advisory Council 14 th Senior Finance Officials Meeting Trujillo, Peru May 2016

2 EXECUTIVE SUMMARY The FMP has entrusted 3 initiatives to ABAC the Asia-Pacific Forum on Inclusion, the Asia-Pacific Forum (APFF) and the Asia-Pacific Infrastructure Partnership (APIP). This presentation describes the activities of APFF and APIP in the area of infrastructure. On 10 May, ABAC and various partner institutions convened in Kuala Lumpur an APFF Workshop on Developing an Islamic Infrastructure Investment Platform (I3P). The idea for the I3P originated at the AFMM lunch dialogue with finance sector in Cebu in September 2015, when Brunei and Malaysia encouraged ABAC to identify barriers to expansion of cross-border investment of Islamic financial institutions, especially pensions and insurance (takaful) in infrastructure. On October 27, Brunei hosted a workshop that identified the need to: (a) develop commonly accepted definitions of Shariah-compliant infrastructure projects and financial instruments; (b) develop Islamic hedging instruments; (c) develop instruments to allow Islamic long-term financial institutions to invest in infrastructure; (d) address tax discrimination against Islamic finance; and (e) agree on common approaches to international regulatory issues. It was agreed to propose a platform through which these steps could be undertaken Islamic Infrastructure Investment Platform (I3P). The 10 May workshop counted as participants multilateral institutions (IsDB, ADB, WB), Islamic financial and asset management (domestic, regional, global), industry associations, government and regulatory agencies, initiatives (e.g., IISS), academe and scholars. The session focused on: (a) cross-border funding of Infrastructure, discussing key considerations, common approaches and financial instruments; (b) key requirements for building dynamic markets; and (c) developing an Islamic Infrastructure Investment Platform (I3P). Participants reached agreement on initial ideas for the mission, vision, structure and work streams of the platform. There were also expressions of interest from participating institutions to collaborate in the platform and expressions of support from Malaysia and Brunei. As next steps, ABAC/APFF will incorporate a proposal for establishing the platform in the 2016 Report to APEC Finance Ministers, and conduct preliminary discussions with institutions signaling interest in playing lead roles in work streams. APIP is also currently discussing possibilities of holding dialogues in Vietnam, China and Thailand, and is preparing a conference in Sydney on 14 September. Required Action/Decision Points It is recommended that the Senior Finance Officials: 1. Note the reported activities and encourage interested finance ministries to actively collaborate with ABAC in undertaking them to advance the Cebu Action Plan.

3 APEC Business Advisory Council Report on ABAC Infrastructure Initiatives under the Finance Ministers Process ABAC Initiatives for the APEC Finance Ministers Process Finance Ministers Process (FMP) 21 APEC Finance Ministries Observers: ADB, IMF, OECD, WBG, ABAC FMP Policy Initiatives APEC Finance and Development Institute Regulators Training Initiative APEC Institutions Dealing with SMEs Forum on Inclusion Forum (APFF) Infrastructure Partnership (APIP) APEC PPP Experts Advisory Panel Asia Region Funds Passport (ARFP) Initiatives entrusted to ABAC 1

4 ABAC Initiatives for the APEC Finance Ministers Process Finance Ministers Process (FMP) 21 APEC Finance Ministries Observers: ADB, IMF, OECD, WBG, ABAC FMP Policy Initiatives APEC Finance and Development Institute Regulators Training Initiative APEC Institutions Dealing with SMEs Forum on Inclusion Forum (APFF) Infrastructure Partnership (APIP) APEC PPP Experts Advisory Panel Asia Region Funds Passport (ARFP) In conjunction with APEC Business Advisory Council Asia-Pacific Forum Workshop on Developing an Islamic Infrastructure Investment Platform (I3P) 10 May 2016 Training Room , Level 3, Sasana Kijang, Kuala Lumpur, Malaysia 2

5 APFF Workshop on Developing an Islamic Infrastructure Investment Platform (I3P) BACKGROUND 2015 September 11, Cebu: At AFMM lunch dialogue with finance sector, Brunei and Malaysia encouraged ABAC to identify barriers to expansion of cross border investment of Islamic financial institutions, especially pensions and insurance (takaful) in infrastructure 2015 October 27, Brunei: Workshop identified the need to: develop commonly accepted definitions of Shariah compliant infrastructure projects and financial instruments develop Islamic hedging instruments develop instruments to allow Islamic long term financial institutions to invest in infrastructure address tax discrimination against Islamic finance agree on common approaches to international regulatory issues. Interested APEC economies should establish a platform through which these steps could be undertaken Islamic Infrastructure Investment Platform (I3P) APFF Workshop on Developing an Islamic Infrastructure Investment Platform (I3P) OUTCOMES OF THE WORKSHOP Participants: Multilateral institutions (IsDB, ADB, WB), Islamic financial and asset management (domestic, regional, global), industry associations, government and regulatory agencies, initiatives (e.g., IISS), academe, scholars Sessions: 1. Cross border funding of Infrastructure: Key considerations, common approaches and financial instruments 2. Key requirements for building dynamic markets 3. Developing an Islamic Infrastructure Investment Platform (I3P) Agreement on initial ideas for the mission, vision, structure and work streams of the platform Expressions of interest from participating institutions to collaborate in the platform Expressions of support from Malaysia and Brunei Next steps: ABAC/APFF to incorporate a proposal in the 2016 Report to APEC Finance Ministers Preliminary discussions with institutions signaling interest in playing lead roles in work streams 3

6 Infrastructure Partnership (APIP) FMP initiative established in 2011 (entrusted to ABAC) Regional platform for public private collaboration in expanding private sector participation in PPP projects Activities: APIP Dialogues with interested individual economies 2011: Mexico, Peru, Philippines 2012: Vietnam, Indonesia 2013: Philippines (2 nd ), Thailand, Indonesia (2 nd ), Malaysia 2014: Indonesia (3 rd ) 2015: Philippines (3 rd ) Channel for private sector participation in APEC PPP Experts Advisory Panel Collaboration with APEC FMP workshops and seminars, infrastructure initiatives and Cebu Action Plan implementation The APIP Network Legal advisers Asset mgt Investment banks Academic and research bodies Public sector agencies Global initiatives Utilities Trading companies Credit rating agencies Commercial banks Industry associations Insurers Consultancy Construction Pension funds Developers Over 60 organizations Over 80 individual experts Collaboration with: Multilateral partner institutions ADB * IFC * IDB * OECD* WB APFF Insurance and Retirement Income Work Stream 4

7 Upcoming APIP Activities APIP Dialogues in November 3, Hanoi (TBC): Dialogue with Vietnam Under discussion: Dialogues with China and Thailand APIP Conference 2016 September 14, Sydney University, Sydney (in conjunction with the John Grill Centre s Annual Infrastructure Dialogue) Need More Information? Contact: Dr. Julius Caesar Parreñas Senior Advisor, Nomura 2-2-2, Otemachi, Chiyoda-ku, Tokyo , Japan parrenas-2p7d@jp.nomura.com 5