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Global infrastructure investments need to reach $97t by 2040

by Released

The cost of providing infrastructure to support global economic growth and to start to close infrastructure gaps is forecast to reach $94 trillion by 2040, with a further $3.5 trillion needed to meet the UN Sustainable Development Goals for universal household access to drinking water and electricity by 2030, bringing the total to $97 trillion, according to the G20’s Global Infrastructure Hub.

The report also reveals that $18 trillion, 19 percent, of the $97 trillion, will be unfunded if current spending trends continue.

Every year $3.7 trillion will need to be invested in infrastructure to meet the demands of an accelerating global population, the equivalent of the total annual GDP of Germany, the world’s fourth-largest economy. And in order to meet the water and electricity SDGs, the investment need forecast increases by an additional $236 billion per year until 2030, when the goals are due to be met.

This is not just a major challenge for emerging countries that need to create new infrastructure, but also for advanced countries that have ageing systems that have to be replaced.

The United States will have the largest gap in infrastructure spending, at $3.8 trillion, while China will have the greatest demand, at $28 trillion, representing a massive 30 percent of global infrastructure investment needs. The report shows the world’s greatest infrastructure needs will be in Asia, which will require $52 trillion by 2040 to meet demand.

The ultimate achievement of the SDGs by 2030 is reliant on the provision of quality infrastructure. On current trends, investment will fall substantially short of meeting SDGs for water and electricity.

Meeting the SDGs for electricity and clean water provision will require $3.5 trillion more than is currently needed to close infrastructure investment gaps.

And closing the global investment gap will require annual infrastructure investment to increase from the current level of 3 percent of global GDP to 3.5 percent. Meeting SDGs will require this to increase further to 3.7 percent between now and 2030.

 

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