MANILA, Philippines – The Economist Intelligence Unit (EIU) has tagged the Philippines as the most improved country in Asia-Pacific in terms of Public-Private Partnership (PPP) readiness.

In a report entitled “Evaluating the environment for Public-Private Partnerships in Asia-Pacific, The 2014 Infrascope,” the EIU said the Philippines joined the developed PPP market group with an overall score of 64.6, improving to 7th place from the previous rank of 8th under the emerging market category with an overall score of 47.1.

The Philippines joined Korea (3rd), Japan (4th), India (5th), and India – Gujarat State (6th) in the developed PPP market with a score ranging between 60 and 79.9.

Australia topped the list with a score of 91.8, followed by the United Kingdom with 88.1.

“By finishing in 7th position, it (Philippines) is among those which have improved the most. It recorded the most-improved regulatory and institutional frameworks and is one of the leading countries in the study for improved investment climate and financial facilities,” the EIU stated in the study.

The report pointed out that the Philippines has one of the oldest Build-Operate-Transfer (BOT) policies in the Asia-Pacific region, but has introduced a new sub-national regulatory framework and has used its increased capacity and transactional experience in recent years to promote capacity-building in emerging PPP markets within the region.

In terms of regulatory framework, the Philippines improved its rank to 4th with a score of 68.8 from 7th place in 2011 with a score of 43.8. Australia was in 1st place with 100 followed by UK with 96.9 and Korea with 90.6.

“The Philippines is the most improved country in overall rankings and the regulatory framework category as a result of significant regulatory reform in recent years, new biddings and selection procedures, better dispute resolution mechanisms, and a wider role for the national PPP Unit. Institutional roles have been further streamlined under the new PPP regime,” the report said.

In terms of institutional framework, the Philippines likewise increased its ranking to 4th place with a score of 66.7 from 8th place with a score of 41.7 in 2011. The Philippine ranked 9th in terms of operational maturity, from 10th place in 2011 and jumped to 7th place in terms of  investment climate from 13th place. It was ranked 8th in terms of financial facilities and 6th in terms of subnational adjustment.

“In the Philippines, in addition to training and capacity building, regulatory amendments have improved evaluation and bidding timelines, giving bidders a longer time to prepare, and streamlined the formalities for small and municipal contracts,” it added.

The EIU cited the PPP Center’s “wider role” in the implementation of the PPP program as a significant factor in the country’s improvement.

It added that the PPP Center has produced guidance on how to conduct multi-criteria analysis (MCA) in project selection, while the newly-created PPP Governing Board has prepared more detailed policies on matters such as risk allocation and private-sector compensation rights.

According to EIU, the feat was achieved despite the controversies surrounding some projects, including the award of the P17.5 billion Mactan Cebu international airport expansion project to the tandem of GMR Infrastructure of India and Filipino-owned Megawide Construction Corp.

“This and earlier controversies related to the bidding and award procedures for major transport infrastructure projects indicate certain weaknesses in public-sector decision making. At present, most PPP stakeholders see the dispute resolution mechanism as transparent and fair, though the whole process can be inefficient due to the length of time it takes to reach a final decision,” it said.