Richard (Rick) Mills
Ahead of the Herd
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As a general rule, the most successful man in life is the man who has the best information
Infrastructure is the physical systems – the roads, power transmission lines and towers, airports, dams, buses, subways, rail links, ports and bridges, power plants, water delivery systems, hospitals, sewage treatment, etc. – that are the building blocks, the Legos, that fuel a countries, a cities or a community’s economical, social and financial development.
There is an undeniable, an unarguable connection between the quality of a countries economic competitiveness and its infrastructure.
“Extensive and efficient infrastructure is critical for ensuring the effective functioning of the economy, as it is an important factor in determining the location of economic activity and the kinds of activities or sectors that can develop within a country. Well-developed infrastructure reduces the effect of distance between regions, integrating the national market and connecting it at low cost to markets in other countries and regions. In addition, the quality and extensiveness of infrastructure networks significantly impact economic growth and reduce income inequalities and poverty in a variety of ways.
A well-developed transport and communications infrastructure network is a prerequisite for the access of less-developed communities to core economic activities and services.
Effective modes of transport—including quality roads, railroads, ports, and air transport—enable entrepreneurs to get their goods and services to market in a secure and timely manner and facilitate the movement of workers to the most suitable jobs. Economies also depend on electricity supplies that are free from interruptions and shortages so that businesses and factories can work unimpeded. Finally, a solid and extensive telecommunications network allows for a rapid and free flow of information, which increases overall economic efficiency by helping to ensure that businesses can communicate and decisions are made by economic actors taking into account all available relevant information.” World Economic Forum, The 12 pillars of competitiveness
The World Economic Forum estimates a global need for $3.7tn in infrastructure investment each year, while only $2.7tn is invested.
McKinsey Global Institute says the G20 nations’ need for infrastructure projects, over the next 15 years, is US$60 trillion. They predict a 60% shortfall in investment money for these projects.
Infrastructure, like everything, has a lifespan. In many areas infrastructure is simply too old. Many of the U.S.’s highways and bridges were built 40-50 years ago, many municipalities water lines were laid 100 years ago and both systems are in desperate need for upgrades.
If infrastructure investment trends in the U.S. stay the same the ASCE estimates ageing and inadequate infrastructure - from power problems to hours lost in traffic jams - will have cost every American family $28,000 in income by 2020
According to the American Society of Civil Engineers’ 2013 report card, the U.S. needs to invest an additional $3.6 trillion by 2020 to upgrade the nation’s infrastructure to acceptable standards. U.S. infrastructure spending makes up 2.6% of the nation’s GDP, the world average is 3.8%. China’s infrastructure spending makes up 8.5% of the nation’s GDP.
Every four years, the American Society of Civil Engineers’ (ASCE) Report Card for America’s Infrastructure depicts the condition and performance of American infrastructure in the familiar form of a school report card. Letter grades are assigned based on the physical condition and needed investments for improvement. Below is the latest, the 2013, report card. The overall grade assigned was D+ for 2013.
The latest UN World Cities Report has found that the number of “megacities” – those with more than 10 million people – has more than doubled over the past two decades. There were 14 megacities in 1995, that number climbed to 29 in 2016.
Globally, about 1.5 million people are added to the urban population every week.