Global Infrastructure Hub InfraCompass 2020 report

An online tool and report on international infrastructure trends will provide Australian policy-makers with data to boost investment opportunities.

InfraCompass 2020, the latest update to the Global Infrastructure Hub’s (GI Hub) online tool, will assist governments in identifying opportunities to encourage and reduce barriers to investment in quality infrastructure.

For the first time, InfraCompass 2020 has ranked countries against eight drivers of quality infrastructure, revealing unique trends since 2017. 

The tool uses data from leading international organisations, including the World Bank Group, World Economic Forum and the Organisation for Economic Co-operation and Development. 

Working with Deloitte Asia Pacific, GI Hub extended InfraCompass’ exhaustive data analysis to 25 new countries across different regions, including the Pacific. 

The tool now covers a total of 81 countries, collectively representing 93 per cent of global gross domestic product and 86 per cent of the global population.

Below are the eight drivers and the top ranked country in each:

  • Governance – Singapore
  • Regulatory frameworks – United Kingdom
  • Permits – Singapore
  • Planning – United Kingdom
  • Procurement – Mexico
  • Activity – Jordan
  • Funding capacity (new) – Denmark
  • Financial markets (new) – United States of America
Favourable conditions for Australia

The most recent InfraCompass report found that Australia’s strong credit rating and transparent public procurement processes provide favourable conditions for investment in infrastructure projects.

To reduce investment uncertainty, the report suggested that Australia could look to improve procurement processes to shorten the duration and minimise cost and risk.

It also found that the long-term impact of the COVID-19 pandemic on Australia’s fiscal position may impact borrowing costs.

Responding to the need for investment amidst pandemic

GI Hub CEO, Marie Lam-Frendo, said the health and economic impacts of COVID-19 across the globe meant there has never been a more important time for effective policy-making by government – and infrastructure is no exception.

“We’ve updated InfraCompass 2020 to support governments around the world in identifying key areas to improve performance, leading to greater investment in infrastructure,” Ms Lam-Frendo said.

“Countries can then realise the flow-on benefits of increased growth, productivity, jobs, trade and better outcomes for the community and environment.”

Key InfraCompass findings include:

  • Planning was the least improved driver globally, with 38 per cent of countries still lacking national infrastructure plans and 28 per cent not yet publishing a pipeline of projects
  • Taxation regimes that create poor incentives for investment were evident in 70 per cent of countries
  • Procurement was the most improved driver globally, with 88 per cent of countries now publishing procurement guidelines, and almost 40 per cent of countries making improvements since 2017
  • 35 per cent of countries do not conduct market soundings before project procurement
  • 95 per cent of countries analysed now have dedicated national infrastructure agencies
  • Some middle and low-income countries are making strides in improving their policy and market drivers to enable the delivery of quality infrastructure

Permits is the most varied driver across income groups. Some lower middle-income countries have reformed their procedures for issuing construction permits and starting businesses and now outperform many high-income countries that have longer legacy processes.

Deloitte Asia Pacific’s Lead Partner – Infrastructure & Capital Projects, Luke Houghton, said the value of InfraCompass was that it pinpointed where and how governments can improve their infrastructure investment capabilities.

“With the prescribed best practice guidance and leadership from decision-makers, InfraCompass can drive greater prosperity by helping to close the infrastructure gap,” Mr Houghton said.

Key updates to InfraCompass 2020 are as follows:

  • Country rankings for each of the eight drivers
  • Case studies of infrastructure best practice in each driver to encourage openness, transparency and greater dialogue among countries on reforms to deliver better quality infrastructure for investment
  • Online users can compare performance across countries and regions
  • Two new drivers – Funding Capacity and Financial Markets – added to create a more comprehensive view of the infrastructure indicators that enable quality infrastructure investment
  • Clear highlights of how well countries perform against each of the eight drivers. This allows countries to identify benchmarks and understand the options for better practice from across the globe
  • 25 new countries have been added to the analysis, including five Pacific Island countries, expanding InfraCompass coverage to a total of 81 countries

According to GI Hub’s Global Infrastructure Outlook, there is an estimated US $15 trillion global infrastructure investment gap over the next two decades. 

Bridging this gap requires a broad set of actions, including creating robust governance and regulatory frameworks, crowding in private finance, enhancing the efficiency of public spending, and leveraging technology and innovation in delivering and managing infrastructure.

With political will to implement reforms, InfraCompass 2020 can help governments to identify and prioritise reforms that deliver a greater service outcome for every dollar invested – an important metric in a post COVID-19 world.

View the full InfraCompass 2020 Report here; see Australia’s full country profile here; and use the interactive InfraCompass tool here.

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