Green Economy Journal Issue 58

THOUGHT LEADERSHIP
THOUGHT LEADERSHIP
and that it has granted to the Asian regions for example, “enviable
record on growth and poverty reduction” (Asian Development Bank,
2005). What is not clear, however, is how much economic growth is
needed to afford the increased capital investment in infrastructure and
the associated ongoing long-term maintenance and operation costs?
Infrastructure impacts on ecosystems
that are already stressed by
climate change impacts.
The Cost-Benefit Gap
Many claims are made of the role infrastructure plays in economic
growth. What is not examined is the cost benefit, particularly who
carries the cost (including maintenance) and who benefits. A good
example here is the construction of new government buildings in
Pretoria. I still do not understand why ministerial offices must look like
presidential suites in a five-star hotel.
QUO VADIS
Infrastructure Development: Part Two
As expressed in the think-piece published in Issue 57, infrastructure backlogs and failures remain
high in many countries. Countless arguments have been made to explain this, with the most popular
one being under-investment.
BY LLEWELLYN VAN WYK, B. ARCH; MSC (APPLIED), URBAN ANALYST
In this think-piece, infrastructure condition reports are reviewed to
assess whether there might be reasons other than those typically
articulated – a systemic fault line perhaps – that might explain why
infrastructure quality continues to lag despite investment.
COUNTRY INFRASTRUCTURE ASSESSMENT REPORTS
Infrastructure diagnostic reviews collect comprehensive data on the
infrastructure sectors of a country and provide a holistic analysis of
the challenges they face. Most reports adopt a sectoral approach,
usually including typical bulk infrastructure services like energy,
water, sanitation, transport and waste. The reports covered include
Australia, Canada, New Zealand, Singapore, South Africa, USA and the
UK. The period covers 1998 to 2021. The reports consulted are listed
in the references.
Other reports use a different narrative to the more conventional
engineering approach, as in the Asian Development Bank (2005) that
uses “stories” as a stock-taking basis. The narrative includes an economic
story (levels of expenditure, stocks of infrastructure assets, access
to infrastructure services and competitiveness); a spatial and demographic
story (the demands on infrastructure of rapid urban growth, linking
the rural poor to growth poles as well as the regional dimension of
infrastructure supporting trade and spreading the benefits across
borders); the environmental story (air quality, emissions, sanitation as
well as the functioning of ecological goods and services); the political
story (who captures the benefits of infrastructure, who provides, to
whom at what price and at whose cost); and lastly the funding story
(the scale of infrastructure needs and how to resource them).
These are crucial questions and were used in this think-piece to
frame a narrative around “systemic infrastructure gaps”. The emergence
of the word “gap” surprised me: in all my research in this field the search
had been predicated on identifying issues, but the more reading that
was done the more the notion of gaps bedded in.
MIND THE GAP
Based on an extensive reading of these reports, the
following main findings emerged.
The Growth Gap
The core argument is that infrastructure is an
essential part of an enabling environment for
investment and livelihood thus promoting economic
advancement, reducing poverty and improving delivery
of health and other services (World Bank, 2014). Almost all reports argue
that infrastructure is a “bedrock for development” (Mitullah, 2016)
High levels of investment do not necessarily
translate into efficient investment.
The Service Gap
Despite investment, access to infrastructure
services remains uneven. The Asian Development
Bank (ADB) acknowledges that infrastructure
plays a dual role: meeting the needs of the
poor and providing the underpinnings for the
region’s growth. The recognition of this dual
role is fundamental to a proper understanding of
sustainable infrastructure design. More critically, the
ADB also notes that the “complexity of responding to these demands
is greater than ever, and the cost of getting things wrong is very
high. Poorly-conceived infrastructure investments today would
have a huge environmental, economic and social impact – and be
very costly to fix later” (Asian Development Bank, 2005).
In many countries infrastructure networks increasingly lag demand
and are characterised by missing regional links and stagnant
household access. In most African countries, universal access to
household services is more than 50 years away (Sudeshna, 2008).
More critically, even where infrastructure networks exist, Sudeshna
(2008) notes that a significant percentage of households remain
unconnected, suggesting that demand-side barriers persist and
that universal access entails more than physical rollouts of networks.
Not unexpectedly, access to infrastructure in rural areas is only a
fraction of that in urban areas (Sudeshna 2008).
The point is made (Foster, 2010) that achieving universal access
will call for greater attention to removing barriers that prevent
the uptake of services and offering practical alternative solutions.
The Network Gap
Understanding that infrastructure is a system of systems is key to
future strategic planning. The development of infrastructure networks
needs to be strategically informed by the spatial distribution of
economic activities and by economies of agglomeration (Foster and
Briceno-Garmendia, 2010). A challenging aspect in this regard is the
infrastructure choices/land-use pattern nexus, especially where those
land-use patterns are not well established and/or the expansion of
those land-use patterns are not accounted for. Often this results in
expensive infrastructure retrofitting.
Difficult economic geography may also present a significant
challenge for infrastructure development: striking the balance
between urban and rural infrastructure design is particularly
challenging, not least because the unit costs of delivering rural
infrastructure is often higher than similar urban infrastructure
(Asian Development Bank, 2005).
In this regard, Infrastructure Australia advocates adopting a placebased
approach which creates a synergistic link between assets
and networks of assets, local and context-specific characteristics
and is beneficial to users of infrastructure services (Infrastructure
Australia, 2021).
The Affordability Gap
Affordability gaps are reported across urban
sectors, and these gaps tend most often to
affect the poor who are often found in periurban,
informal settlements. In developing
economies infrastructure services may be
twice as expensive in some countries, reflecting
both diseconomies of scale in production and
high-profit margins caused by lack of competition
(Foster and Briceno-Garmendia, 2010).
The Basic Services Gap
The provision of basic services
stays uneven: access to water and
sanitation remains low in lowand
middle-income countries. A
reliable electricity supply remains
the predominant infrastructure
challenge, with many countries
facing regular power shortages
and many paying high premiums
for emergency power.
The Funding Gap
In most cases the funding needs exceed the
available revenues. The cost of addressing
infrastructure needs is many billions of
dollars a year, about one-third of which is
for maintenance (Briceno-Garmendia, 2008).
However, due to the large infrastructure
spending backlog, the estimated spending
needs contain a strong component of
refurbishment and replacement. The challenge
varies by country type – fragile states face an
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