Institutional Investing in Infrastructure

October 1, 2016: Vol. 9 Number 9

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Infrastructure

Bank Shot: China’s new infrastructure bank begins its rollout

With the 2016 Rio Olympics and one of the most watched U.S. elections in modern history headlining the news cycle this past summer it might have been easy to miss a very important story in the world of infrastructure. The operations of the Asian Infrastructure Investment Bank (AIIB) came into full effect creating the first major multilateral development bank in a generation. Its mandate is to provide loans for infrastructure projects such as energy, communications and transportation. 

Infrastructure

Financing Asian infrastructure: barriers and risks

For institutional investors, an important question is whether they could contribute more to the financing of infrastructure. Two points of qualification: First, it is often overlooked in this debate that pension funds, insurance companies, and other investors have been keen buyers of publicly listed infrastructure stocks and bonds for a long time. Second, investment in unlisted infrastructure is an ongoing process, as investor intention surveys indicate continued interest in this sector.

Infrastructure

Enthusiastic for energy: Investors continue to direct commitments to the sector

Despite falling energy prices, investors and managers are still flocking to energy, power and renewables funds. Perhaps that is because infrastructure investing is meant to be long term, and long term, energy demand is only expected to grow. The U.S. Energy Information Administration’s International Energy Outlook 2016 (IEO2016) projects that world energy consumption will grow by 48 percent between 2012 and 2040. 

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