Sustainable infrastructure is a powerful tool for achieving inclusive growth. But it is an expensive one. USD 6.3 trillion of investment in infrastructure is required annually on average up to 2030 to support economic growth and the broader development agenda linked to the United Nations Sustainable Development Goals (SDGs).
New technologies can advance project outcomes in the construction industry. Governments are well-poised to cultivate greater adoption.
Smart infrastructures require governance, specifically governance of intelligence and intelligence-enabled control. For example, in some very important respects, smart infrastructures should be dumb and that will take governance. One way to quickly see the point is by way of analogy to the Internet and the decades-long and still ongoing debate about network neutrality. The end-to-end architecture of the Internet and open Internet regulation govern certain uses of intelligence and thus intelligence-enabled control by infrastructure owners.
Because of its role as an important driver of both economic and productivity growth, development and maintenance of infrastructure network are usually a major concern to political agenda. Nevertheless, there is a widespread agreement that the current investment trend may not be sufficient to meet a constantly growing demand for infrastructures, driven by the rapid development among emerging markets. Estimates by Oxford Economics point to a structural gap that, from its 2016 level of USD 372 bln, will face an yearly average growth of 3.2% until 2040.
This study is an initiative of the ISPI’s Centre on Infrastructure, promoted with the knowledge partnership of McKinsey & Company. It analyses the importance of economic infrastructure and how to finance and develop it. Economic infrastructure is the backbone that, in many cases, crosses the borders of political geo- graphy and defines the space supporting the movement of goods, services, people and their ideas.
The thriving Digital Economy we are currently seeing is the result of profound transformations engendered by the application of new digital technologies. We expect that this will continue to accelerate economies across the world, resulting in the digitalization of the productive and tertiary processes of our planet.
Recent events have been a stark reminder of the assumptions behind the future of aviation. In the UK and more recently in the US, airports have been shut down by civilian drones, causing unanticipated, but not unforeseeable disruption to flights. Meanwhile, Brexit uncertainty continues to pose challenges for airlines – with foreign ownership rights threatening to restrict flights in the event of a no-deal.
The US protectionist policies, the prospect of a tariff war with China, the migrant crises, “temporary” borders shutdowns (even within the Maastricht Treaty perimeter), the unpredictable consequences of an unmanaged Brexit as well as rampant sovereign ideologies are all signals that point in the same direction: a more fragmented world.
Investment in ports is the most visible incarnation in Europe of China’s new maritime Silk Road. In the coming years, China’s footprint in the Mediterranean Sea will continue to expand but will be subject to greater scrutiny and possibly resistance. The adoption of the EU-wide investment screening system in 2019 will help Europe evaluate future investment projects from the perspective of their potential security implications.
Connectivity has always been an essential feature of any society. Even more so today: connectivity has been shaping globalization by reducing distances, boosting international trade, and improving the interdependence of countries and their economies. Thanks to connectivity, many of the political barriers that have traditionally hindered a greater integration among nations have been overcome.
The demand for infrastructure has risen on the global agenda over the past five years and is partially a result of many countries making strong economic progress. Countries, as they become wealthier, can afford and demand more infrastructure.