Infrastructure Financing in Southeast Asia after Decentralization

During the past twenty years, Southeast Asia has witnessed a great push towards decentralization and increased responsibilities for subnational governments. Among these responsibilities, financing urban infrastructure poses some of the greatest challenges. The Capstone team focused on the financing of urban service delivery in Indonesia, Philippines, and Vietnam, three countries which are at various levels of decentralization and all of which face considerable infrastructure finance challenges. The team developed a framework to assess infrastructure finance systems and applied it to the three countries. The team identified common and unique experiences and issues, as well as highlighted innovative or successful practices that could be applicable in other countries. The factors underlying the better practices are documented to the extent possible, and their potential relevance for broader application is considered.