By Peter OBIORA InvestAdvocate
Lagos (INVESTADVOCATE) – The International Monetary Fund (IMF) and Multilateral Development Banks (MDBs) has endorsed the emphasis and initiative the Group of Twenty (G20) has placed on infrastructure over the past few years.
The IMF and MDBs affirmed that infrastructure is key to tackling poverty and promoting inclusive growth. ‘’Infrastructure helps improve access to basic services, especially for poor people, links producers to markets and connects countries to the opportunities in the global economy. Well-functioning infrastructure is essential to overcome bottlenecks to growth in emerging and developing economies, and as an enabler of private sector led growth,’’ a statement by the head of MDBs and IMF said.
The global development banks and IMF said no country has developed without access to well-functioning infrastructure. They said at a time when the outlook for global growth is disappointing, investment in infrastructure can play an important role in boosting short-term demand, as well as bolstering longer-term supply capacity.
‘’We work on the ground in countries at all levels of development, under country-owned and country-led strategies to support the full life cycle of infrastructure development — from advice on sectoral and business climate reforms, and project preparation, transaction structuring and financing, through to implementation and ongoing maintenance, as well as monitoring and evaluation of development impact. We help countries not only to build resilient infrastructure, but also to build the institutional capacity to manage that infrastructure over the longer term, the statement added.
The MDBs and IMF further affirmed just as important as the quantity of spending is the qualityof infrastructure spending. It added that infrastructure investments need to be sustainable: fiscally, economically, socially and environmentally.
According to the global lender and regional development banks, the needs are immense as the infrastructure gap in emerging and developing economies is broadly estimated at over $1 trillion per annum. ‘’Meeting these needs will require renewed efforts to mobilize resources from existing as well as new sources of finance, including from institutional investors. MDBs have the knowledge and experience to leverage greater private sector involvement in the infrastructure sector worldwide and are developing new platforms to mobilize private finance on a larger scale,’’ the statement said.
The two bodies noted that the critical barrier to achieving uplift in infrastructure investment in emerging and developing economies is not a lack of available finance, but an insufficient pipeline of bankable projects ready to be implemented.
‘’We stand ready to bring our experiences and skills to the G20’s work on infrastructure and to support a proposed new Global Infrastructure Hub. We are well placed to contribute to knowledge sharing and creation of infrastructure networks,’’ MDBs and IMF affirmed.
