The World in 2011
THE ECONOMIST
The World in 2011 - 25-year Special Addition
The Eonomist Intelligence Unit - The world in figures lndustries
INFRASTRUCTURE
lnfrastructure projects were the favoured route for stimulus funding in the aftermath of the financial crisis; large-scale public works can quickly create jobs and, if done right, boost long term economic growth as well.
Nearly $2trn, or around 3% of global GDP, is spent on infrastructure each year. The World Economic Forum estimates the combination of population growth, urbanisation and past under investment will require a doubling of such spending over the next 20 years. With private credittight, this acceleration will come largely from developing countries with more fiscal leeway and a greater need for infmstructure improvements.
China will kick off a new five-year plan in 2011 with more than $1trn devoted to infrastructure. Late in the year, the $30bn Beijing-Shanghai high-speed railway will open. Not to be outdone, lndia will rush to spend the remaining funds allocated to its $500bn infrastructure budget for the five years to March2012. Private financiers- such as Reliance Capital, which will boost lending to the infrastructure sector from $2bn in 2010 to $9bn in 2013-will help developers and contractors tap these funds.
Brazil, meanwhile, will begin building a $19bn, 511km high-speed railway between Rio de Janeiro and 56o Paulo in 2011. The country, which skipped through the global recession with barely a pause, plans to spend nearly $530bn on infrastructure between 2011 and 2014, boosting investment as a share of GDP but still lagging behind Asia's emerging markets
To watch: The aerotropolis. Ciiy planners are looking to airporls to fill ihe anchor role once claimed by seaports. New Songdo lnternationai City, a $35bn development on reclaimed land near lncheon airpod in South Korea, will house 65,000 residents and accornmodate 300,000 office workers when complete in 2014. Developments are also planned near the Atlanta and Memphis airports, America's busiest airpassenger and cargo hubs.