EAP - The Pacific Infrastructure Challenge - World Bank (2006).pdf

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5 How well are Pacific Countries Performing ‘Infrastructure Performance’ describes how effectively infrastructure services are provided to consumers over the long term. We measured infrastructure performance by comparing sector specific indicators of service coverage, quality, cost and economic viability for Pacific and comparator 6 countries. This allowed us to establish whether sector performance is relatively good or relatively poor in each country. Detailed benchmarking by infrastructure sector is presented in Appendix A, based on publicly available data. Overall, we observe that although some utilities perform well, and infrastructure access is adequate in some (mainly urban) areas, Pacific countries do not perform as well as comparator countries on most key performance indicators. This section represents a summary of our observations. 5.1 Some Evidence of Good Performance Some service providers perform very well The Fiji Electricity Authority (FEA) became one of the best performing electricity utilities in the Pacific, following the appointment in 2001 of a Board with significant private business experience and a mandate to run the utility as a commercial entity. FEA has improved efficiency, reduced production costs and system losses, improved labor productivity, become financially self-sufficient, and introduced private sector participation in power generation. Vanuatu’s privately owned electricity and water operator, UNELCO, performs better than any of the other Pacific utilities we reviewed, on measures of quality and efficiency in water and electricity. The utility recovers all operating and capital costs, as well as the costs of loss-making rural electrification, through its tariff. Apia Port in Samoa and Lae and Port Moresby in Papua New Guinea have some of the highest TEU throughput rates. They also have relatively low port charges. All of these ports are profitable. Teledensity has improved, and internet tariffs have dropped in some countries Tonga’s mobile penetration levels have increased significantly since competition has been introduced. Within a year of introducing competition for mobile services, the tariff for almost all services dropped by more than 20% and the numbers of mobile subscribers and internet users both doubled. The result of competition has been that “telephones are easier to get, cheaper to buy and communication is faster”. It has also resulted in the two competing companies upgrading their infrastructures for further use in communications and broadcasting. In Papua New Guinea, competition between ISPs has reduced internet tariffs. In Samoa, the introduction of competing ISPs resulted in a price reduction of 50% in the incumbent ISP and an increase in internet traffic of over 100% 7 . 6 Comparator countries included: Jamaica, St Lucia, St Kitts & Nevis, Grenada, Dominica, Barbados, Mauritius, New Zealand, the Philippines, 7 Castalia interview with Grant McGough, Acting CEO SamoaTel in September 2004 14
Infrastructure access is adequate in urban areas in some transport sectors Road density in urban centers is adequate for the population and traffic flows in most Pacific countries. However, access to rural and remote areas is inadequate in larger dispersed countries like Papua New Guinea and Vanuatu. International and inter-island routes within the Pacific region are served by a mix of public and private operators. These routes are open to competition and services are considered to be adequate and efficient, with the exception of some outer island routes. Air services are vital to Pacific countries and airport capacity plays an important role in accommodating tourist, business and cargo traffic. Larger Pacific airports such as the main airports in Fiji, Samoa and Papua New Guinea can accommodate long haul flights on B747s, while smaller airports such as Bonriki International in Kiribati can only accommodate the smaller B737 aircraft. Although anecdotal evidence suggests that airport capacity is constrained at peak times, on major routes, capacity appears to be adequate at most airports given existing annual passenger and aircraft traffic. 5.2 More Evidence of Underperformance Access to network infrastructure is generally lower than in comparator countries Pacific countries generally have lower levels of access to telecommunications, electricity, and improved water and sanitation, than similar countries with the same level of income such as the Caribbean Islands or the Philippines (where a significant proportion of the population live on small islands). In the telecommunications sector, in comparator countries, adoption of mobile phones has significantly increased access to telecommunications in recent years, especially in rural areas. Mobile telephony in Pacific countries has grown over the past few years, and is increasingly treated as a substitute for fixed line services, but growth in mobile uptake significantly lags most of the comparator countries. Telecommunications access in the Pacific is largely limited to urban areas. Similarly, access to electricity in Pacific countries is relatively low, as Figure 5.1 shows. 15
Page 2 and 3: The Pacific Infrastructure Challeng
Page 4 and 5: Table of Contents 1 Acronyms and Ab
Page 6 and 7: Figure 8.4: Annual Per Capita Inves
Page 8 and 9: Box 7.9: ECTEL - Regulatory Coopera
Page 10 and 11: kWh MDG MIAA MIPA MNOC MOTCA MOU MP
Page 12 and 13: 2 Executive Summary This discussion
Page 14 and 15: Fiscal, regulatory and policy decis
Page 16 and 17: Figure 2.2: Estimated Annual Invest
Page 18 and 19: 3 What’s the Purpose of the Discu
Page 20 and 21: Box 4.2: Improving Infrastructure f
Page 24 and 25: Figure 5.1: Access to Electricity 1
Page 26 and 27: Water tariffs are often too low In
Page 28 and 29: Table 6.1 shows that in addition to
Page 30 and 31: These characteristics mean that Pac
Page 32 and 33: 6.2 Challenges to Institutions and
Page 34 and 35: 6.2.2 Demographic Issues in the Reg
Page 36 and 37: These high rural populations mean t
Page 38 and 39: Figure 6.3: Comparison of Defining
Page 40 and 41: Lack of legal and regulatory suppor
Page 42 and 43: 7 Challenge: How do we Lift Perform
Page 44 and 45: 7.1.2 Poor Policy Design and Coordi
Page 46 and 47: different, some efficiency may be g
Page 48 and 49: Figure 7.1: Accountability in Infra
Page 50 and 51: Box 7.3: Expert Panels can Improve
Page 52 and 53: Some of these reforms have already
Page 54 and 55: 7.2.2 Choose an Appropriate Reform
Page 56 and 57: Box 7.5: Public Sector Reforms in t
Page 58 and 59: Pacific countries, management salar
Page 60 and 61: There are three classic types of pr
Page 62 and 63: While private sector involvement ma
Page 64 and 65: Air services would also benefit fro
Page 66 and 67: 7.2.5 Regional Coordination One opt
Page 68 and 69: 8 What’s the Size of the Challeng
Page 70 and 71: Figure 8.3: Annual Per Capita Inves
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Figure 8.5: Mainlines Trend 0.600 N
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Figure 8.8: Annual Per Capita Inves
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Figure 8.11: Total Annual Per Capit
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9 How do we meet the Challenge This
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Box 9.3: Can private sector involve
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Box 9.6: How can the public sector
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The proportion of mainline access a
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Box A.2: Introducing Telecommunicat
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Universal Access Universal access r
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good example of this. The Kiwi Shar
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Figure A.7: Reported Faults per 100
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Table A.1: Institutional Indicators
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and there have been calls to recons
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A.2 Electricity Sector Analysis A s
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Figure A.10: Average Electricity Ta
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Figure A.11: Economies of Scale in
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interest rate relief on a US$9m loa
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As Figure A.14 shows, Vanuatu perfo
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Table A.3: Industry Structure and G
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Regional Cooperation in Electricity
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A.3 Water and Sanitation Sector Ana
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Figure A.17: Availability of Water
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Figure A.20: Staff per 1000 Connect
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including full operating expenses a
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Corporatization is often employed t
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operating costs, collections levels
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Figure A.25: Road Network Density v
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Federated States of Micronesia at b
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In Samoa: Samoa’s Public Works De
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Many Pacific countries already outs
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4. Domestic and Pacific Island serv
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Figure A.31: TEU Throughput Levels
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system reduces cargo handling effic
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Economies of Scale Port operations
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The landlord model is the most comm
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Fiji 84 Ports The Maritime and Port
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Apia Port has become one of the bes
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Kiribati 90 Ports The Kiribati Port
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In Shipping: Services are considere
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Figure A.36: Total Passenger Throug
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Airline Services Figure A.38 illust
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establishment period. For the offic
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Vanuatu 101 Airports Vanuatu Limite
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Samoa 104 The Samoa Airport Authori
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Institutional Arrangements in Aviat
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Summary of Aviation Analysis The Pa
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Fiji Kiribati Marshall Islands Micr
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Barbados Dominica Grenada Jamaica M
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Samoa Solomon Islands Timor-Leste T
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Samoa Solomon Islands Timor-Leste T
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EAP - The Pacific Infrastructure Challenge - World Bank (2006).pdf

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