Investment. In Latin America and the Caribbean

In Latin America and the Caribbean, the financing gap is equally large. The region currently spends on average less than 2% of GDP on infrastructure annually, while some 3-6% of GDP is required (Omura, 2006; Fay and Morrison 2007). Public sector investment in infrastructure in the region has fallen considerably.

This is partly due to fiscal adjustments to macroeconomic crises and a tendency by some governments to reduce public investment because of privatization initiatives, and a shift towards giving the private sector responsibility for infrastructure financing and management (Fay and Morrison, 2007). Private investment in infrastructure in the region has increased, but not enough to fill the gap in financing; and it has been unequally distributed across industries as well as by countries.

Regional integration in Asia and Oceania, Africa and Latin America and the Caribbean is also accentuating regional infrastructure development and cooperation in transport, energy grids, ports and airports. Physical infrastructure connectivity is important to support regional integration, which in turn is crucial for facilitating intraregional trade, production and investment.

This form of South regional cooperation is helping to boost economic development in the respective regions. The investment needs of these projects are also significant, although in some cases intraregional infrastructure activity can help bridge overall financing gaps in countries through a sharing of development costs or exploiting economies of scale and scope.

Table III.3. Sub-Saharan Africa: estimated annual infrastructure investment needs in selected industries, 200-2015a

Box III.6. India: Financing infrastructure
Over the period 2007-2012, India will need investment averaging $99 billion per annum in 10 major infrastructure segments, to support a planned annual GDP growth of 9% (box table III.6.1). The public sector is expected to provide 70% of this investment, and the private sector the rest. Moreover, the private sector is expected to take the lead in financing some infrastructure such as telecommunications, ports and airports.

However, these ambitious plans could face the same financing gaps as those of the preceding periods: over the period 2001- 2010, for instance, the annual financing gap is estimated at close to $14 billion (box table III.6.1). So far, FDI has played only a very small role in the overall financing of infrastructure. Between April 2000 and February 2008, India attracted an average of only $1.3 billion of FDI per annum in electricity, roads, telecommunications, ports, railways and airports. Source: UNCTAD.

Box table III.6.1. India: estimated annual infrastructure investment needs, financing gaps and FDI flows, various years

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Table of Contents In Latin America Useful links Free Job Search Teaching Jobs All Customer Service Jobs Part Time Clerical Jobs Gila River Casino Jobs Summer Jobs For Students Data Entry Work From Home USA Jobs Home Based Business Jobs Office Jobs Civil Engineering Jobs Part Time Jobs In NY IT Project Manager Job Call Center Jobs Welding Jobs	In Latin America and the Caribbean... In Latin America and the Caribbean, the financing gap is equally large. The region currently spends on average less than 2% of GDP on infrastructure annually, while some 3-6% of GDP is required (Omura, 2006; Fay and Morrison 2007). Public sector investment in infrastructure in the region has fallen considerably. This is partly due to fiscal adjustments to macroeconomic crises and a tendency by some governments to reduce public investment because of privatization initiatives, and a shift towards giving the private sector responsibility for infrastructure financing and management (Fay and Morrison, 2007). Private investment in infrastructure in the region has increased, but not enough to fill the gap in financing; and it has been unequally distributed across industries as well as by countries. Regional integration in Asia and Oceania, Africa and Latin America and the Caribbean is also accentuating regional infrastructure development and cooperation in transport, energy grids, ports and airports. Physical infrastructure connectivity is important to support regional integration, which in turn is crucial for facilitating intraregional trade, production and investment. This form of South regional cooperation is helping to boost economic development in the respective regions. The investment needs of these projects are also significant, although in some cases intraregional infrastructure activity can help bridge overall financing gaps in countries through a sharing of development costs or exploiting economies of scale and scope. Box III.6. India: Financing infrastructure Over the period 2007-2012, India will need investment averaging $99 billion per annum in 10 major infrastructure segments, to support a planned annual GDP growth of 9% (box table III.6.1). The public sector is expected to provide 70% of this investment, and the private sector the rest. Moreover, the private sector is expected to take the lead in financing some infrastructure such as telecommunications, ports and airports. However, these ambitious plans could face the same financing gaps as those of the preceding periods: over the period 2001- 2010, for instance, the annual financing gap is estimated at close to $14 billion (box table III.6.1). So far, FDI has played only a very small role in the overall financing of infrastructure. Between April 2000 and February 2008, India attracted an average of only $1.3 billion of FDI per annum in electricity, roads, telecommunications, ports, railways and airports. Source: UNCTAD. back to top
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