Online - 18 July 2020: First of all, let me congratulate the Saudi Presidency for its leadership during this crisis.
While G20 members are still focused on the immediate response to the health crisis, many of you around the table are also shifting towards economic recovery. Infrastructure-related investments should, and will, become an important element of medium- to long-term stimulus measures to help drive the global economic recovery.
As such, we welcome the emphasis on infrastructure in the G20 Action Plan under pillars three and five, and the GI Hub is very pleased to be supporting these efforts in three main ways:
- To help inform decisionmaking on tradeoffs governments will need to make, you have received our Interim Report on Infrastructure for Recovery Post- COVID-19 that includes two important pieces of analysis:
- A quantitative analysis of the impacts of public investment on economic growth. This study establishes that public investment, which includes infrastructure, is more effective in increasing economic output over the medium term than other types of public spending and, on average, has achieved a fiscal multiplier of about 1.5 within two to five years vs 1.0 for public spending. It also establishes that public investment raises productivity and private output in the long run, where a 1% increase in the total value of public capital stock is expected to increase private output by approximately 0.2% every year.
- It also presents a qualitative analysis of selected past infrastructure programs. This illustrates how infrastructure investments can help achieve both local economic recovery and broader policy objectives, aligned with the G20 Quality Infrastructure Investment (QII) principles.
- We compiled a use case library to support the InfraTech Agenda, which has been presented as a Reference Note. These cases demonstrate the benefits that digital and technology can bring to infrastructure, especially in unlocking greater efficiency, resilience, and value for money in infrastructure investments. To support the Action Plan, we have been able to incorporate several use cases that are globally relevant to help prevent and mitigate the impact of a crisis like COVID-19.
- To continue supporting tangible progress on the implementation of the G20 QII Principles, in the second half of this year we will facilitate the compilation of good practices through a voluntary member-led survey and provide analysis to highlight where more progress could be made. This work will also help inform the important work on QII indicators.
We remain committed to supporting G20 members in the global economic recovery from the impacts of COVID-19. We will continue to work closely with the G20 Infrastructure Working Group, other relevant working groups, and the multilateral development banks and international organisations involved in the G20 Action Plan, and I look forward to reporting back to you in October.
Let me conclude by saying that we have a short window of opportunity to build back better, and more sustainable, inclusive, and resilient infrastructure is critical to our shared future.