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Overview

Girl in rain with umbrella

Infrastructure is critical to support social progress and the achievement of the Millennium Development Goals. Access to basic infrastructure services remains an issue, in low-income countries and in many middle-income countries, as well. In East Asia and the Pacific, for example, a quarter of the population living in cities lack improved water, sanitation and durable housing. In Sub-Saharan Africa, nearly 70% of people remain without access to electricity. Worldwide, two thirds have yet to gain access to the internet.

Video: The Impacts of Infrastructure Gaps on Women

Aspirations for growth are fuelling the demand for infrastructure across countries. Client countries view availability and reliability of infrastructure services as critical to private sector growth and firms’ competitiveness in domestic and international markets. The 2008 global crisis also showed the significance of public spending in infrastructure as a powerful countercyclical instrument to withstand recessions.

Increasingly, infrastructure can be viewed as the critical agent to address the more systemic development challenges of today’s world, thereby transforming client countries’ development path toward more sustainability. Tackling these challenges will require looking at the complex inter-connectivity among sectors. Responding to rapid urbanization, for example, will necessitate coordinated planning and actions in transport, water, ICT, and many other sectors, including social development. Adaptating to climate change and meeting environmental goals, while sustaining growth, will require an infrastructure that is less damaging to the environment and more resilient to natural disasters and other shocks. It also requires a new vision about who finances infrastructure.

The infrastructure gap is estimated at $1 trillion in low- and middle-income countries, and the demand for infrastructure continues to grow as countries develop.

 

Infrastructure for Social Progress

— From 1990 to 2008, nearly 2 billion people, both rural and urban, have gained access to improved drinking water

— By the end of 2010, 90% of the world’s inhabitants were covered by a mobile cellular signal, with penetration in developing countries reaching 68%

— In 2009, an additional 20 million people were provided with access to electricity

Infrastructure for Growth

— A 10% increase in infrastructure investment contributes to 1% GDP growth

— Infrastructure development contributed to half of the acceleration in growth in Sub-Saharan Africa from 2001 to 2005

Infrastructure as a countercyclical instrument

— A US$1 increase in public spending in infrastructure in developing countries generates a US$0.35 increase in exports from developed countries

— In Latin American and the Caribbean, US$1 billion additional infrastructure spending has contributed to 40,000 new jobs

 



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