The Global Infrastructure Investment Deficit
5 September 2012
By Richard Mills
Infrastructure is the physical systems – the roads, power transmission lines and towers, airports, dams, buses, subways, rail links, ports and bridges, power plants, water delivery systems, hospitals, sewage treatment, etc. – that are the building blocks, the Legos, that fuel a countries, a cities or a community’s economical, social and financial development.
There is an undeniable, an unarguable connection between the quality of a countries economic competitiveness and its infrastructure. Yet study after study shows the global economy running an infrastructure deficit of anywhere from US$40 trillion to $70 trillion.
Booz Allen Hamilton, in a 2007 report, estimated that investment needed to “modernize obsolescent systems and meet expanding demand” for infrastructure worldwide between 2005 and 2030 was around US$ 41 trillion.
Infrastructure spending geographically:
- Middle East $0.9 trillion
- Africa $1.1 trillion
- US/Canada $6.5 trillion
- South America/Latin America $7.4 trillion
- Europe $9.1 trillion
- Asia/Oceania $15.8 trillion
Infrastructure spending by sector:
- Water and wastewater $22.6 trillion
- Power $9.0 trillion
- Road and rail $7.8 trillion
- Airports/seaports $1.6 trillion