The recently launched Standard Gauge Railway train. [Photo/the-star.co.ke]
Kenya will need to increase its spending on infrastructure by 41% in order to meet its infrastructure needs by 2040 and the UN’s Sustainable Development Goals (SDGs).
According to the Global Infrastructure Outlook report released on Tuesday, over US$170 billion (Sh17.7tr) is currently being spent on enhancing the country’s infrastructure against US$206 billion (Sh21.4tr) that is required for the next 23 years.
With Kenya’s population expected to increase by 35 million people by 2040 coupled with economic growth of 5.5%, over US$310 billion (Sh 32tr) will be needed if Kenya is to achieve the SDG’s including a four-fold increase in electricity investment.
The ground-breaking new report by the G20’s Global Infrastructure Hub (GI Hub) outlines infrastructure investment needs globally and individually for 50 countries and seven sectors.
It reveals the cost of providing infrastructure to support global economic growth and to close infrastructure gaps which is forecast to reach US$94 trillion by 2040, with a further $3.5 trillion needed to meet the UN Sustainable Development Goals (SDGs) for universal household access to drinking water and electricity by 2030, bringing the total to $97 trillion.
“Outlook is a comprehensive and detailed analysis of infrastructure investment need. It gives the new country and sector spending data that governments and funding organisations have been calling for,” says Global Infrastructure Hub CEO Chris Heathcote.
“Outlook tells us three key things, how much each country needs to spend on infrastructure to 2040, where that need is for each infrastructure sector, and what their gap is, based on their current spending trends,” he added.
Outlook, which can be accessed through an online tool, also reveals that $18 trillion – almost 19% – of the $97 trillion, will be unfunded if current spending trends continue.
Every year $3.7 trillion will need to be invested in infrastructure to meet the demands of an accelerating global population, the equivalent of the total annual GDP of Germany, the world’s fourth largest economy.
And in order to meet the water and electricity SDGs, the investment need forecast increases by an additional $236 billion per year until 2030, when the goals are due to be met.
This is not just a major challenge for emerging countries that need to create new infrastructure, but also for advanced countries that have ageing systems that have to be replaced.
The United States will have the largest gap in infrastructure spending, at $3.8 trillion, while China will have the greatest demand, at $28 trillion, representing a massive 30% of global infrastructure investment needs.
The ultimate achievement of the UN’s Sustainable Development Goals (SDGs) is reliant on the provision of quality infrastructure. On current trends, investment will fall substantially short of meeting SDGs for water and electricity by 2030.
Press Release.