The Global Infrastructure Hub (GI Hub) has published a new report, Infrastructure Monitor 2020, which highlights a decade-long decline in private investment in infrastructure through primary market transactions.
Infrastructure Monitor 2020 also reveals that financial performance of infrastructure investments is better than is generally expected and that infrastructure becomes more stable over time whilst
other asset classes increase in risk.
In 2017, GI Hub’s Global Infrastructure Outlook found the world was facing a US$15 trillion gap between projected investment and the amount needed to provide adequate global infrastructure by 2040.
GI Hub CEO, Marie Lam-Frendo, said that the Infrastructure Monitor report findings have significant implications for investors and regulators and are a building block on the road to infrastructure as an asset class.
“Private investment of US$100 billion per year is a drop in the ocean compared to the estimated US$15 trillion global infrastructure financing gap,” Ms Lam-Frendo said.
“Whilst mobilising private capital is key, Infrastructure Monitor shows a lack of private sector appetite for new infrastructure investment.
“Now is the time for industry to explore other options, with true partnership between the public and private sectors, to help close the infrastructure gap.
“This has become critical as governments around the world face fiscal challenges as a result of the COVID-19 pandemic.”
Other key findings from Infrastructure Monitor 2020 include:
- In 2019, only 25 per cent of private infrastructure transactions occurred in new infrastructure investments, down from 64 per cent in 2010
- Private investment in social infrastructure declined the most from US$19 billion in 2010 to US$3 billion in 2019
- Social infrastructure has experienced lower default rates than other infrastructure sectors
- Total investment in more carbon-intensive and less sustainable energy was greater than investment in renewables in low and middle-income countries
- Latin America, the Middle East and North Africa have been fast growing regions for private investment, while Europe has seen the largest decline
The inaugural global report provides data-driven insights from 2010–19 into priority areas of the G20 agenda on infrastructure. View the full Infrastructure Monitor Report 2020 here.
Image credit: GI Hub