A new report from the G20’s Global Infrastructure Hub (GI Hub) forecasts that global infrastructure investment needs could reach $97 trillion by 2040 if countries don’t take action now.
The report – the Global Infrastructure Outlook – also warns that $18.5 trillion of that figure will be underfunded if current spending trends continue.
According to the report, this means that every year $3.8 trillion will need to be invested in infrastructure to meet the demands of an accelerating global population.
It also reveals that the road and electricity sectors will require the greatest spending as the global population becomes increasingly urbanised.
The report shows that China will have the greatest demand fir infrastructure spending at $28 trillion, which represents 30 per cent of the global infrastructure investment needs.
This represents more than half of Asia’s need and 30% of global demand, while India and Japan combined account for another 10% of the expected need.
A press release from GI Hub, asserted that the increased need for infrastructure in China, India and Japan, in particular, highlights opportunities for Australian engineering construction and services firms.
“If Asian countries continue to invest strongly in infrastructure, demand for raw material such as iron ore, of which Australia has some of the world’s largest proven reserves, should remain strong, along with demand for private capital and infrastructure delivery skills,” the statement said.
Outlook also shows:
- By 2040, the global population will increase by almost two billion people – a 25% increase – almost all of whom will live in cities, triggering massive demand for infrastructure support.
- Meeting the UN’s Sustainable Development Goals (SDGs) just in respect of electricity and clean water provision will require $3.5 trillion more than is currently forecast to be invested.
- Closing the global spending gap will require annual infrastructure investment to increase from the current level of 3.1% of global GDP to 3.8%.
The Outlook report and online tool can be found at: www.outlook.gihub.org