Emerging markets’ “breath-taking” infra gap

Speaking at our Emerging Markets Forum 2014, keynote speaker Nelson Cunningham highlighted enormous challenges and opportunities.

Nelson Cunningham, a US political expert who advised the Clinton administration, spoke of the “breath-taking difference” between developed and emerging markets in terms of access to vital infrastructure at Infrastructure Investor’s Emerging Markets Forum 2014 in London.

He pointed out that the Dallas Cowboys football stadium uses the same amount of power that is available to the entire West African nation of Liberia, which has a population of more than 4 million; and that North Dakota has as much access to electrical energy as Nigeria – despite the latter’s population being 250 times larger.

Addressing a room packed with influential investors at the Institute of Directors, Cunningham added that the “dramatic need” in Africa was illustrated by predictions that its population will double from one billion today to two billion by 2050. This compares with large developed economies in North America, Europe and Asia which are seeing populations either grow slightly or shrink slightly.

He also highlighted the staggering pace of urbanisation, with the world’s city populations having grown from 750 million to around 4 billion over the last 50 years. Furthermore, over the next 20 to 30 years, a third of urban growth globally will be in just three countries – India, China and Nigeria. These three nations will see almost a billion extra city dwellers between them in the next three decades.

Cunningham, a lawyer and political adviser, was special adviser to President Bill Clinton for Western Hemisphere affairs and also advised John Kerry’s 2004 Presidential campaign on foreign policy and trade issues. He is also president and co-founder of McLarty Associates, assisting clients with national and international policy issues.

While the infrastructure gap presents opportunities, he warned of risks including cyber-attacks on essential assets from hostile groups and governments; and the lack of a “proper framework and incentives” to mitigate climate change.

He also cautioned that the world is “as unsettled today as any time in living memory, taking us in new and unexpected directions – some good, but most going the wrong way”. In this context, he was referring to such developments as the volatility in the Middle East, the ebola outbreak and various territorial tensions in Europe and Asia.