Despite the fact that social infrastructure and water projects, such as clean water and wastewater operations, are identified as top priorities from private and public sector entities from around the world, a new infrastructure survey shows global industry leaders are not hopeful about an increase in infrastructure spending following the worldwide spread of COVID-19.
In its new Global Infrastructure Industry Survey, CG/LA Infrastructure found only five percent believe investment will ‘increase significantly’ following the pandemic, a sharp decline from 34 percent before the crisis. In total, only 27 percent believes infrastructure investment would increase or increase significantly—a drop from 71 percent when asked previously.
Prior to the crisis only 10 percent of respondents thought infrastructure investment would decrease (seven percent), or decrease significantly (three percent), but now a majority (52 percent) believe infrastructure investment will decline (34 percent) or decline significantly (18 percent).
“The data shows that the outbreak of COVID-19 cases worldwide has essentially put a halt to infrastructure investment globally,” said Norman Anderson, CEO of CG/LA Infrastructure. “It is clear that more has to be done—whether it is building more hospitals or schools, or other key projects delivering high quality benefits such as clean water and irrigation systems—particularly in developing countries. Given that infrastructure needs to be a driver of the global economic recovery, obviously these results are deeply troubling.”
A critical theme emerging from the survey is 82 percent of respondents view infrastructure as a weak or average brand. Only 18 percent identified infrastructure as a strong brand—the vast majority saw it as problematic, or characterized by incompetence and, especially, chronic corruption.
Overall, given the lack of public trust in the infrastructure brand there is an urgent need to address emerging markets infrastructure. Other findings include 28 percent selected social infrastructure (i.e. new hospitals, and schools) as their top priority, with 55 percent listing it as one of their top three priorities. Clean water was highlighted as the top priority by 14 percent and was included in a top three priority by 48 percent of respondents. Transit and highways (12 percent) and wastewater (11 percent) were other top areas cited as in need of investment.
“As fears around the extent of the global recession increase, it is important that the U.S. government and multilateral institutions understand the depth of this problem,” said Anderson. “Given this acute crisis, now is the time for leadership, an investment model that will allow local economies to recover, and real attention to the benefits that infrastructure brings to people—not just jobs, but health, and a sense of confidence in the future.”
The survey was conducted from March 19 to 30 with over 13,000 global respondents in engineering/construction, finance, public sector, and technology fields. In a separate recent survey, 94 percent of U.S. infrastructure executives agreed an infrastructure stimulus was critical for the U.S. to emerge quickly from the current crisis. 94 percent of respondents also believe the U.S. should increase private infrastructure investment.