2019 Blended Finance Task Force

 

2019Estimates suggest that the required annual infrastructure spend is around $6 trillion per year with most investment needed in emerging markets. We are falling short by around $2.5 trillion every year; half of which is expected to come from the private sector. Blended finance solutions which use development capital to mitigate investor risks will play a crucial role in attracting more private capital for this agenda. This paper analyses recent developments and conclude that in addition to urgently need to scale infrastructure investment around the world, we also need to invest “smarter” by increasing the productivity of new infrastructure or reducing the cost through an infra-light model.

This will be possible through what it refers to as  “Infra 3.0” – an approach to infrastructure delivery which is highly distributed, digitised and “service” based, and which captures the benefits of new technologies, economic clusters and natural solutions to increase asset resilience and connectivity. By taking a “lifecycle” approach the paper also reconfigures the costs and benefits of an asset over its lifetime, including the impact of operation and maintenance (O&M) and the cost of negative externalities on human health and the environment, especially from high carbon assets. Such information will be crucial to help governments plan infrastructure programs that are strongly supported by both investors and the users of the services it provides.