Latin America needs to double its investment in infrastructure

(Asuncion, October 31, 2011).- "The region’s current investment of 2.5% of GDP in infrastructure is far below what is needed to move ahead with development and achieve the regional integration which is our objective," Enrique Garcia, president & CEO of CAF - Latin American development bank – said, on presenting his institution’s study on Infrastructure in the Integrated Development of Latin America (IDeALl): Strategic diagnosis and proposals for a priority agenda to the leaders attending the XXI Latin American Summit of Heads of State and Government in this city.

"To have an optimal infrastructure, Latin America needs to invest US$250 billion a year," Garcia said in his remarks. The study analyzes the current state of infrastructure in Latin America, identifies and assesses the requirements for its development, and proposes a strategic agenda for the coming years.

The CAF chief emphasized the commitment to Latin American integration made by his institution, which is now the main source of funding for infrastructure in the region, with more than US$30 billion invested in the last 10 years.

The study prepared by the multilateral financial institution focuses on transport infrastructure in all modes: power, telecommunications, natural gas, and water supply and sanitation.

IDeAL 2011 includes a concise analysis of the situation in key infrastructure sectors, recognizing the priorities for a strategic agenda for the sector in Latin America aimed at achieving desirable scenarios and identifying priority issues in the short term.

The analysis highlights the need to significantly increase investment in broadband expansion, extension of water supply and sanitation, freight railways, urban transport through integrated metro and bus rapid transport (BRT) systems, overall improvement of the road network and its maintenance, and incorporation of road safety policies.

Improvement of socio-environmental standards and development of public institutions capable of planning and implementing projects and coordinating joint public-private work partnerships, are also stressed in the study.

"CAF continuously tracks infrastructure in Latin America and presents this sectoral report to the Summit with the aim of disseminating knowledge promoting the search for information and the coordination of networks in the productive and social sectors as a means of stimulating development of the sector" García said.

Finally, the CAF president said it was important to deepen the integration process in the region, strengthening ties between countries with a view to meeting the challenges of the dynamism of the global economy together.

"If Latin America wants to achieve a truly international presence, reversing its loss of relative importance in the world economy and acting as a global player with the required weight, it is essential for all us actors to return to the idea that integration is not a luxury but a necessity, García said.

See the publication La Infraestructura en el Desarrollo Integral de América Latina (IDeAL).