Infrastructure investment undoubtedly has a strong impact on economic growth and development. However, when combined with long-term considerations of sustainability, inclusivity, and resilience, it also has the potential to achieve transformative outcomes for both people and the planet. Consideration of these outcomes in the development and delivery of infrastructure means moving from built solutions that address singular problems to those that can address multiple outcomes and have the greatest impacts on our most pressing global challenges, such as the climate crisis, social inequality, adaptation, and resilience.
Beyond economic growth and development, inclusivity was the most targeted transformative outcome by G20 central governments in 2022, with around half (51%) of investment in infrastructure targeting at least one inclusive outcome, such as inclusive mobility or affordability and access to services. 56% of inclusive infrastructure investment was in the transport sector (as investments in areas such as roads and public transportation improve access and connectivity), and 20% was in the social sector (such as schools and hospitals).
Climate goals also featured prominently, with 39% of G20 central government investment in infrastructure targeting either environmental sustainability or resilience. The transport and social sectors made up around half of this investment (24% and 21% respectively). This pattern of public investment contrasts with trends in private investment in infrastructure; among private investors, there is minimal investment outside of the renewable energy sector.
The UK government’s Transport Decarbonisation Plan is one example of transport investments targeting environmental sustainability outcomes. The UK plan includes funding for measures such as zero emission buses, public charge points in residential areas to support the transition to electric vehicles, the development of sustainable aviation fuel plants, the construction of cycle lanes to accelerate the modal shift to active transportation, and R&D programs to help commercialise low- and zero-emission technologies – including trials of zero emission Heavy Goods Vehicle (HGV) technologies.
In the social sector, Canada’s Green and Inclusive Community Buildings program is an example of investing in energy-efficient and accessible community buildings, and Singapore’s HDB Greenprint aims to transform existing public housing estates into greener and more sustainable homes.
Governments targeted less investment toward digital/InfraTech and R&D outcomes. These outcomes attracted only 9% and 5% of total G20 central government infrastructure investment in 2022, respectively. Unsurprisingly, around half of digital/InfraTech investment was in the communications sector (49%), but other sectors also saw investment aimed at the digitalisation of infrastructure. For example, Germany’s budget included measures for the digitalisation of municipal transport and public health institutions, while Spain’s included investments for digital transition in the water sector, including digitalisation of water control systems and investments in technological solutions such as drone constellations.
All these initiatives highlight the potential for infrastructure investment to move beyond addressing singular problems, and towards addressing multiple transformative outcomes, thereby maximising the contributions of infrastructure to sustainable development, the climate transition, and other global priorities.
Note: G20 central government investment reflects planned direct central government investment in infrastructure as well as central government transfers to other levels of government for infrastructure investment. It does not capture investment directly planned by subnational levels of government or other public entities, such as state-owned enterprises. All infrastructure investments target the outcome of economic development and investments can target more than one outcome.