Introduction

After decades of neglect, and despite many other distractions in the global economy, infrastructure has finally made it to the top of the political agenda. According to a recent survey, 77 percent of senior business executives believe that the current level of public infrastructure is inadequate to support their companies' long-term growth. These executives believe that over the next five years, infrastructure will become a more important factor in determining where they locate their operations.1

The public also has awakened to the consequences of neglecting our roads, bridges, public transit, electricity grid and other social infrastructure (such as hospitals and schools). According to a recent poll, 94 percent of Americans are concerned about the condition of the nation's infrastructure. Remarkably, 81 percent said they are willing to pay 1 percent more on their federal income tax to improve America's infrastructure.2

Table 1. 2009 global stimulus programs with a significant infrastructure component

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a  Gemma Daley, "Australian Senate Passes Rudd's A$42 Billion Stimulus," Bloomberg News, February 13, 2009 <http://www.bloomberg.com/apps/news?pid=20601110&sid=apqK4QGQTUSY>.

b  "$12B for Infrastructure Forms Key Pillar of Stimulus Package," CBC News, January 27, 2009 <http://www.cbc.ca/canada/story/2009/01/27/budget2009-infrastructure.html>.

c  Bill Powell, "Should China and the U.S. Swap Stimulus Packages?," Time, March 05, 2009 <http://www.time.com/time/business/article/0,8599,1883277,00.html>.

d  International Federation of Consulting Engineers, "Fiscal Stimulus Package Survey 2009" <http://www1.fidic.org/about/infra09/>.

e  "Sarkozy Outlines €26 billion French Stimulus Plan," New York Times, November 4, 2008 <http://www.nytimes.com/2008/12/04/business/worldbusiness/04iht-04franc.18398529.html>.

f  Daniel Schmachtenberg, "German Infrastructure Stimulus Packages: Necessity Is the Mother of Invention," January 2009 <www.ashursts.com/doc.aspx?id_Content=4161>.

g  "Japan Unveils New Economic Stimulus of 15.4 Trln Yen," Reuters, April 10, 2009 <http://www.reuters.com/article/usDollarRpt/idUST26081720090410>.

h  International Federation of Consulting Engineers, "Fiscal Stimulus Package Survey 2009."

i  "Worldwide Inventory of Infrastructure Spending Plans," Foreign Affairs and International Trade Canada, January 21, 2009 <http://www.international.gc.ca/canadexport/articles/90121h.aspx>.

j  Ibid.

k  Infrastructure and the American Recovery and Reinvestment Act of 2009," Deloitte, March 12, 2009.

Thanks to the stimulus packages unveiled in many countries during 2009 (see table 1), public infrastructure is receiving both long overdue attention and a significant infusion of public funds. While these are welcome developments, the level of direct government funding proposed will meet only a tiny fraction of infrastructure needs around the world. In the United States, according to the American Society of Civil Engineers, there is a $2.2 trillion gap between the supply of and demand for roads and bridges, water and sewage systems, public transit systems and other public infrastructure (see appendix A).3 The infrastructure stimulus money from the 2009 American Recovery and Reinvestment Act (ARRA) addresses less than 5 percent of these infrastructure needs.

That said, the current confluence of events does present government leaders with a once-in-a-lifetime opportunity to make a timely and economically productive down-payment on closing the global infrastructure gap.

Funding is not the only challenge. A business-as-usual approach by the public sector will waste an important opportunity to make our infrastructure safer, more efficient and more effective. The inadequate, and in some cases dangerous, state of certain infrastructure demands new thinking to speed its improvement. This means using the full complement of innovative infrastructure financing and delivery solutions that are available, while also developing new approaches to address today's challenging credit markets.