Infrastructure Investment Needs and Sources of Financing
By Yasuyuki Sawada
Developing Asia must mobilize $1.7 trillion annually to meet its infrastructure needs. Governments can increase public investment in infrastructure by raising more revenues, reorienting spending, and borrowing prudently, as well as adopting innovative approaches such as “land value capture.” Also, expanded private financing of infrastructure investments is indispensable. Particularly, public–private partnership can help fill the financing gap by allocating risk to the party best able to manage it. The success of the approach depends on governments identifying projects suitable for it, engaging qualified private partners, and instituting the right process.