The World Bank estimates that infrastructive needs in developing East Asia are expected to reach US$200 billion per annum between 2006 and 2010. To fund this, private sector investment is needed to complement public sector expenditure. Singapore, as the leading infrastructure player and financing centre in Asia, is well-placed to contribute to the growing needs for infrastructure financing within the region.
In February 2007, the first infrastructure trust in Asia was listed on the SGX, creating a new asset class in the Singapore market. Infrastructure trusts, which are structured as business trusts under the Business Trust Act, give investors exposure to income stream from regional infrastructure assets.
Singapore’s first infrastructure bonds backed by gas and water utilities assets were also issued on the back of this transaction. Singapore now has a range of long-dated debt capital market instruments to help investors with long-dated liabilities manage their risks, including the successfully auctioned 20-year Singapore Government Securities.