The demand for quality infrastructure in the Indo-Pacific region and beyond is both a challenge and an opportunity for the international community. Public finance on its own cannot close the infrastructure gap, and with foreign aid limited to a few hundred billion dollars each year, the global demand for quality infrastructure will require financing from diverse sources including the private sector, multilateral development banks (MDBs), and others. Conventional development assistance can be leveraged to catalyze private finance participation and create new opportunities for investment in several meaningful ways. Support for crowding in private investment is also a crucial part of the Trump Administration’s National Security Strategy, which calls for “strengthened cooperation with allies on high-quality infrastructure” in Asia.
Globally, an increased emphasis on quality infrastructure reflects the growing recognition that infrastructure of subpar quality can become bottlenecks to sustainable growth. The G20, Asia-Pacific Economic Cooperation (APEC), Asia–Europe Meeting (ASEM), and other international fora have also highlighted the importance of quality infrastructure. It is a challenge faced not just by traditional donors, but emerging donors as well. Therefore, a discussion on the need for a shared understanding of the fundamental principles of quality infrastructure - and its consolidation as a universally-accepted international standard – will be useful. This new report identifies the practical steps that Japan, the U.S., and the international community can take together to help close the global infrastructure gap and enable quality infrastructure.
Daniel F. Runde is a senior vice president and director of the Project on Prosperity and Development. Sundar R. Ramanujam is a research assistant with the Project on Prosperity and Development at CSIS.
This report was made possible by generous support from the Ministry of Foreign Affairs of Japan and their cooperation with the CSIS Project on Prosperity and Development.
