The report looks at infrastructure based on the dynamics of four key markets: Mature International Markets (like Canada, Australia, UK), Economic Powerhouses (including the US and BRIC countries), Smaller Established Markets (like Chile, Sweden, New Zealand, Korea), and Emerging Markets. The panel of independent industry experts evaluated over 400 diverse and compelling projects to ultimately select the final 100, based on:
Scale - How does the scale of the project relate to similar developments in its class? Feasibility - Is the project plan feasible and sustainable? Complexity - How challenging or complex is it to get stakeholder support? Innovation - Is there a particular challenge the project overcomes? Impact on society - Does it improve quality of life or promote economic growth?
With a total estimated value of over US$1.73 trillion, the 100 projects illustrate a range of infrastructure investment, some with a potentially transformative impact that could change the face of nations. Many of the projects are designed to drive economic growth by connecting people and resources to global and local markets (40% of projects featured); others will help provide better access to reliable power and clean water (30% of projects); while others are focused on improving society through things like healthcare and education.
Meeting the funding challenge However, the Infrastructure 100 also bring to light affordability concerns and the need for governments to make difficult choices about where to spend with funding in short supply. Balancing the aspirations of a nation with the need for true social benefit is not an easy challenge.
"Each country has its own approach to developing and funding infrastructure, yet all share the universal challenge of creating the right conditions to attract investment so desperately needed," says James Stewart, KPMG's Chairman of Global Infrastructure. "Private capital continues to play a critical role, but investors need economic and political stability before committing. Consistency and sustainability are the key, in setting policy, the right regulatory environment and establishing a steady deal flow through project pipelines."
Attracting private investment The report illustrates the critical role of private investment in meeting the infrastructure challenge, with different investment dynamics in each market category:
Economic powerhouses - have significant infrastructure needs - either to support rapid growth and urbanization or to rebuild, repair or upgrade aging assets. "The panel of industry experts identified a surprisingly high reliance on public sector debt sources," said Stewart.
Emerging markets - represent a frontier for private finance in infrastructure, although a lack of funds, inadequate planning, and unstable political environments have limited the availability of projects that could attract private money.
Mature international markets - A combination of privatization, regulation and a wide range of investors has heightened competition for infrastructure in these markets. An increasing trend for asset sales or privatizations is identified in the report.
Smaller established markets - tend to favor domestic financing, with international financiers restricted by the lack of major projects, competitive local capital and currency risk. However, KPMG's report notes an increasing need for these markets to consider collaborative, cross-border infrastructure projects that deliver regional economic growth and bring the scale of major projects that international investors are seeking.
Building for the future The Infrastructure 100: World Markets Report [http://www.kpmg.com/infrastructure100 ] strikes a note of caution over the limited supply of specialist talent that poses a big threat to the momentum of infrastructure development. It also touches on new technology and questions when it will have a meaningful impact on the infrastructure industry in the same way it has transformed other sectors. However, the report also acknowledges the continued ability of the sector to innovate, with trends such as capital recycling and asset management helping to make better use of budgets and generate vital funds for further investment.
"Ultimately, we see a better world supported by infrastructure projects that are desperately needed, those that are opportunistic, and others that are truly visionary," said Stewart.
About the Infrastructure 100: World Markets Report This report is the result of in-depth discussions by a distinguished panel of independent industry experts from around the world. It looks at infrastructure in four key markets: mature International markets; economic powerhouses; smaller established markets; and emerging markets. The independent judging panels assessed hundreds of project submissions based on feasibility, social impact, technical and/or financial complexity, innovation and impact on society to ultimately select the final 100.
*View a complete list of the 100 projects online at: http://www.kpmg.com/infrastructure100
About KPMG's Global Infrastructure Practice For more information, visit http://www.kpmg.com/infrastructure
About KPMG International For more information, visit http://www.kpmg.com
Laura Jablonski, Head of Marketing & Communications, Global Infrastructure, 12 Nov. (416) - 777-8849, email@example.com; Kent Miller, Global Communications, +1(908)313-5037, firstname.lastname@example.org