World Bank Urges APEC Economies to Invest More in Infrastructure

The World Bank (WB) is urging 21 member-economies of the Asia-Pacific Economic Cooperation (APEC) to invest more in infrastructure to sustain growth which is important to improve the living standards especially of the poor.

In a press briefing here, WB Vice President for East Asia and the Pacific Axel van Trotsenburg noted that governments in the region need to continue or accelerate economic reforms, among them boosting investments in physical infrastructure.

“In this region, 142 million households still have no access to electricity while 600 million people lack access to adequate sanitation. It will be very important for greater investment to be accompanied by increases in efficiency of such expenditure,” he said.

Trotsenburg said the infrastructure investment gap in the region remains huge at $ 1 trillion a year, noting that developing countries together are investing only half of this amount.

The private sector participation in the infrastructure currently in all these developing countries is less than $ 200 million, or less than 10 percent of the needed investment, he said.

Trotsenburg thus underscored the important role of public-private partnerships (PPP) schemes and increased private sector involvement in infrastructure development.

For one, he said the International Finance Corp. and the Multilateral Investment Guarantee Agency of the WB Group intend to contribute to building a stronger pipeline of bankable projects as well as in the financing and execution of these projects.

The World Bank created the Global infrastructure Facility (GIF), a global open platform that facilitates the preparation and structuring of complex infrastructure PPPs to enable mobilization of private sector and institutional investor capital.

“We can think we can play a lead role. Today in Asia, the WB is already investing only in the infrastructure area over $ 10 billion a year. We have an active portfolio of $ 60 billion in Asia only in infrastructure…We are set to step up our engagements in these areas,” Trotsenburg further said.

Accelerating infrastructure development and financing is among the four pillars of the Cebu Action Plan (CAP), a 20-year development roadmap for the Asia-Pacific region which the APEC Financial Ministers are set to unveil Friday,Sept. 11.

The roadmap’s other pillars include advancing fiscal reforms and transparency, promoting financial integration and enhancing financial resiliency. (PNA) CTB/LDV