The world’s largest development finance institutions have backed plans by the G20 to create a “hub” to promote global infrastructure investment.
In a joint statement, the heads of the African Development Bank, the Asian Development Bank, the European Bank for Reconstruction and Development, the European Investment Bank, the Inter-American Development Bank, the Islamic Development Bank, the World Bank Group and the International Monetary Fund said they were ready to contribute to the implementation of the initiative.
“We look forward to partnering with the G20 to convene events to share knowledge and develop practical tools to assist infrastructure policy-makers and practitioners. We would also be able to bring to the table our existing collaboration on knowledge and capacity-building initiatives as part of this to help countries learn from each other how complex projects have been planned, structured, tendered and implemented using real world examples.”
The G20 approved the launch of the initiative in September, and a pilot phase to “road test new models to deliver complex public-private infrastructure in low and middle income countries” is due to start by the end of the year, the World Bank said last month.
The G20 Global Infrastructure Initiative is part of plans to shift from economic policies largely reliant on public spending towards growth models involving a significant private sector component. One of its aims is to encourage member countries to boost investment through best-practice planning and development.
The hub will also seek to increase infrastructure investment by fostering innovation in public works and sharing knowledge about matching investors with projects. It will be based in Sydney and – at least initially – will be largely funded by Australia, Tony Abbott, the country’s Prime Minister, told the local press this week.
Multilateral lenders stressed that they jointly provide more than $130 billion of infrastructure financing annually, against an estimated infrastructure gap estimated over $1 trillion per annum in developing economies.
“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,” they said. “Well-functioning infrastructure is essential to overcome bottlenecks to growth in emerging and developing economies, and as an enabler of private sector led growth.”