The Governance Brief: Infrastructure Asset Management: Can the Canadian Municipal Experience Help Inform Better Practices in Southeast Asia? (Issue 21-2015)

Abstract

With the rapid urbanization in Southeast Asia, coupled with a rising infrastructure deficit, the time is right for local government units (LGUs) to move to a comprehensive asset management system.

Field observations in Southeast Asia (Indonesia, the Philippines, and Viet Nam) in 2014 indicate that their LGUs are experiencing many of the same issues as their counterparts in Canada. Comprehensive asset management systems and overall long-term plans to address infrastructure deficits do not seem to be in place, particularly in small and medium-sized LGUs. Without a clear plan for managing infrastructure assets, it is difficult to prioritize investments and identify “bankable” infrastructure projects that would attract funding from the government or the private sector.

LGUs in Southeast Asia would experience many of the same benefits as LGUs in Canada if they were to adopt comprehensive asset management systems. The principles underlying asset management are always the same, and the systems and approaches can be scaled to suit different realities and needs. LGUs in Asia will face the same infrastructure deficit crisis that LGUs in North America are currently facing and will continue to face. In some aspects, the challenge across many municipalities in Asia is deeper because of a continuing net flow of migration from the rural to urban centers, placing further pressure on stretched infrastructure. If LGUs implement proper asset management programs, they will be able to avoid higher costs and unsustainable futures. They will also be able to better address quality of life issues for their residents and create economic development opportunities.