In 2013, investment commitments to infrastructure projects with private participation declined by 24 percent from the previous year. It should be welcome news that the first half of 2014 (H1) data – just released from the World Bank Group’s Private Participation in Infrastructure (PPI) database, covering energy, water and sanitation and transport – shows a 23 percent increase compared to the first half of 2013, with total investments reaching US$51.2 billion.
A closer look shows, however, that this growth is largely due to commitments in Latin America and the Caribbean, and more specifically in Brazil. In fact, without Brazil, total private infrastructure investment falls to $21.9 billion – 32 percent lower than the first half of 2013. During H1, Brazil dominated the investment landscape, commanding $29.2 billion, or 57 percent of the global total.
Four out of six regions reported declining investment levels: East Asia and the Pacific, South Asia, Africa, and the Middle East. Fewer projects precipitated the decrease in many cases. Specifically, India has experienced rapidly falling investment, with only $3.6 billion in H1, compared to a peak of $23.8 billion in H1 of 2012. That amount was still enough to keep India in the top five countries for private infrastructure investment. In order of significance, those countries are: Brazil, Turkey, Mexico, India, and China.
Sector investments were paced by transport and energy, which together accounted for nearly all private infrastructure projects that were collected in this update. The energy sector captured high investment levels primarily due to renewable energy projects, which totaled 59 percent of overall energy investments, and it is poised to continue growth due to its increasing role in global energy generation.
The energy sector also had the biggest number of new projects (70), followed by transport (28), then water and sewerage (12). However, transport claimed the greatest overall investment, at $36 billion, or 71 percent of the global total.
While we need to see what the data for the second half of 2014 show, what we have to date suggests that infrastructure gaps may continue to grow as the private sector contributes less. It also suggests that, in many emerging-market economies, there is much work to be done to bring projects to the market that will attract private investment and represent a good deal for the governments concerned.
A wide range of local governments around the world have introduced integrated modal fares as a way to reduce the burden on low-income users. But the design of these systems requires a very thorough analysis of the urban transport modes being integrated. Bad design may foster inefficiency and lead to huge subsidies that the government, and ultimately the taxpayer, must pay for.
Here are some tips on how to prepare for the design and implementation of integrated fare schemes:
The Latin America and the Caribbean region is crying out for infrastructure improvements. An investment estimated at 5 percent of the region’s GDP — or US$250 billion per year — is required to develop projects that are fundamental for economic development. This includes not only improving highways, ports and bridges, but also building hospitals and creating better transport, public transit and other mobility solutions for smarter cities. Rising demand for infrastructure also is prompting countries to redouble efforts to attract greater private investment
At the Multilateral Investment Fund (MIF), as at the World Bank Group, we believe that public-private partnerships (PPPs) can help governments fill this infrastructure gap. However, the projects must be implemented effectively and efficiently to achieve social and economic objectives.
Governments in the Latin America and the Caribbean region not only lack financing to address the infrastructure gap, but also face challenges in selecting the appropriate large infrastructure projects, planning the projects, managing and maintaining infrastructure assets — and gaining public support for private investment in public infrastructure.
However, PPPs are gaining ground in Latin America and the Caribbean. Beyond the larger economies of Brazil, Colombia and Mexico, assistance from the MIF and the Inter-American Development Bank (IDB) has enabled countries such as Paraguay to develop laws that pave the way for PPP projects. Just this week, Paraguay announced its first such project, which involves an investment of US$350 million to improve and build more than 150 kilometers of roads.
PPPs have been moving beyond classic interventions in public infrastructure, which have typically included roads, railways, power generation, and water- and waste-treatment facilities. The next wave of PPPs increasingly involves and provides social infrastructure: schools, hospitals and health services. In Brazil, IFC, the private sector arm of the World Bank Group, helped create the Hospital do Subúrbio, the country’s first PPP in health, which has dramatically improved emergency hospital services for one million people in the capital of the state of Bahia.
Modeled 2012 population in Guatemala at a spatial resolution of 100 m2
Inside the World Bank, the number of people passionate about using spatial data for development speaks to the relevance of spatial datasets in supporting critical decision making. In an effort to use spatial data more strategically, we recently conducted an informal poll among several Bank units and some partner institutions to find out what types of spatial data are most relevant to development professionals.
This survey found that the spatial distribution of the population was a key data layer needed by Bank staff. The results of the survey showed that that while national level data are useful, subnational detail on administrative boundaries, trade & transport infrastructure, population distribution and socio-economic data down to the city level are just as critical to the majority of respondents.
There was cause for celebration at the State of Rio de Janeiro’s Office of Women’s Affairs last week. The office had just launched a new program that provides support and legal assistance to survivors of gender-based violence, which was covered by a wide range of media and commemorated by a visit from senior World Bank leadership to Brazil.
Our team is currently visiting Rio to help with activities for this new program, called “Via Lilas.” Rio’s government has a lot to cheer about; the program is both innovative and significant. Its primary component is a system of electronic kiosks, placed at stations along Supervia suburban rail lines, which contain helpful information about how women can seek support for gender-based violence.
The placement of these kiosks is strategic; the Supervia provides some of the poorest communities in the region access to jobs and services.
The rail service connects downtown Rio de Janeiro to the periphery in this sprawling metropolitan area of more than 4,500 square kilometers and 12 million people. Outlying parts of the metropolitan area, such as the community of Japeri, can be more than two hours by train to Rio’s Central station.
The “Via Lilas” kiosks will be placed at high-profile locations along the Supervia system, providing easy information access to the approximately 700,000 passengers who use the rail network each day.
If you thought Indian women would shy away from working in that traditionally male preserve - the formidable public transport system - think again. Young women in Chandigarh are daring to turn stereotypes on their head by signing up in large numbers to work as bus conductors! And that too on regular public buses, not just on female-only ‘ladies specials’.
The Economic Community of West African States (ECOWAS) is making some real progress in regional integration. After decade-long negotiations, it has just launched its own Common External Tariff (CET), and now a final proposal for an Economic Partnership Agreement (EPA) with the European Union is also on the table.
However, vast differences in opinion remain regarding the likely effects of these reforms. In Nigeria—a key player in the region— debate is currently lively as to whether the country should sign the EPA, with some local stakeholders wary of the proposed reduction in trade protection.
Noting these concerns, the World Bank Group recently shed more light on the anatomy of these trade shocks. By analyzing detailed trade and firm data in a simple short-term framework, we were able to pick up details that are important determinants of how the reforms might play out—even in the longer run. The full reports can be found here, along with a non-technical policy note.
So what did we find?
There are several non-transport factors, or urban design factors, that play a critical role in a traveler’s decision on their best travel mode.
The first critical factor is density. As illustrated in a famous study done by Alain Bertaud, a former World Bank staff, density is the primary reason why 30 percent of daily trips are carried out by public transport in Barcelona, but only four percent in Atlanta. Barcelona is about 30 times denser than Atlanta, so it is therefore much easier to provide same level of public transport services in Barcelona than Atlanta.
One lesser-known factor is accessibility. Just having a high population density may not guarantee more people to use public transport.
This post is also available in French and Spanish .
“I’ve seen some of the highest performance bicycles in the world, but I believe the most powerful bicycle is the one in the hands of a girl fighting for her education, or a mother striving to feed her family.”
- F.K. Day, Founder of World Bicycle Relief
The rainbow jersey, Giro d’Italia, Tour de France, or Vuelta a Espana—that’s what usually comes to mind when we think of cycling. However, elite cycling is only one small spoke of a much larger wheel.
By some estimates, there are already more than two billion bikes in use around the world. By 2050, that number could be as high as five billion. Over 50 percent of the human population knows how to ride a bike. In China, 37.2 percent of the population use bicycles. In Belgium and Switzerland, 48 percent of the population rides. In Japan, it is 57 percent, and in Finland it’s 60 percent. The Netherlands holds the record as the nation with the most bicycles per capita. Cyclists also abound in Norway, Sweden, Germany, and Denmark. The Danish capital, Copenhagen, is considered the most bicycle-friendly city in the world. It’s known as the “City of Cyclists,” where 52 percent of the population uses a bike for the daily commute. Bicyclist commuters are generally healthier than those who drive motor vehicles to work. They also remain unaffected by OPEC decisions about crude oil production or the price per barrel.
Due to the size of China’s population, and the need for bicycle transportation, statistics on the country’s bikeshare program are staggering. In a database maintained by Russell Neddin and Paul DeMaio, more than 400,000 bikeshare bikes are used in dozens of cities on the Chinese mainland, and the vast majority of those bikes have been in operation since 2012. There are an estimated 822,000 bikeshare bikes in operation around the world. China, therefore, has more bikeshare bikes than all other countries combined. The country with the next-highest number of bikes is France, which has just 45,000.