Infrastructure

In December 2011, the transformational impact of infrastructure development for low- and middle-income countries was brought to light at the World Infrastructure Summit, a gathering of sponsors, developers, financiers, and key government figures involved in the sector across the globe.

“Many governments have not yet exhausted all the opportunities that are available to allow the private sector to commercially provide the full range of infrastructure services”, Gulrez Hoda, IFC Director for Infrastructure in Southern Europe, the Middle East and North Africa.

Citing IFC’s extensive experience in infrastructure development, Hoda highlighted the role played by private enterprise in the sector, where a mixture of public and private investment has spurred growth in the most successful developing countries. He added that fresh approaches and financing for infrastructure has emerged from middle income countries, such as Brazil, China, India and Turkey, where IFC has considerable investments.

Hoda emphasized the impact of the revolution in telecommunications saying, “Years, or possibly decades of waiting for access to high-cost telecoms services have been replaced with low-cost, high quality choices that are easily accessible.”

The combination of new technology and the rapid reduction in costs, combined with risk-taking entrepreneurship has opened new avenues for the use of telecommunications, including access to information that empowers farmers to negotiate for better prices for their produce with middlemen.

The conference also discussed new roles for multilaterals in infrastructure development in the changing economic environment.  Brian Casabianca, Senior Strategy Officer with the Infrastructure Department highlighted the strong need from commercial banks for international financial institutions to help reduce the risk profile of infrastructure investments in emerging market countries.

“2012 will be a rollercoaster year for infrastructure financing according to commercial banks and developers, and multilateral development banks will be needed more than ever to provide comfort, and the stamp of approval for project and corporate financing.”