FIDIC launched its new State of the World report, Time to $Tn-vest, at a webinar on 18 February 2021, which highlighted the trillion-dollar investment challenge facing the global infrastructure sector.
The webinar, attended by 288 global construction and infrastructure professionals, heard that global infrastructure could require at least $7 trillion spending on it every year if the world is to address the growing climate emergency and recover from the effects of the Covid-19 pandemic. FIDIC’s State of the World report recommends that a massive global effort is needed to improve infrastructure spending to meet the investment challenge facing the world which would amount to a doubling of current infrastructure investment to at least $7 trillion.
Introducing the report, FIDIC’s head of economic and strategic policy Graham Pontin said that the economic damage caused by the Covid pandemic was massive and should not be underestimated. He highlighted three key conclusions in the report. “We need to significantly raise infrastructure spending to meet the UN sustainable development goals to ensure that investment is a priority as we emerge from the Covid crisis,” said Pontin. “We also need to closely monitor the investment maintenance balance and understand it better and above all, sustainable investment needs to be prioritised with investment mechanisms developed to transfer current spend towards sustainable infrastructure,” he said.
Speaking at the webinar, Asian Infrastructure Investment Bank vice president Sir Danny Alexander congratulated FIDIC on the production of an important report. Highlighting the importance of digital infrastructure in particular, he said that investment in digital connectivity and digital healthcare would be crucial going forward. “In order to be effective we need to focus efforts on encouraging private investment in infrastructure to avoid digital haves and have nots,” he said. Alexander also said that technology had a key role to play in monitoring and maintaining infrastructure assets going forward.
Alexander also spoke about the importance of climate change and the need to invest in climate resilient infrastructure and to crucially show that such investments were attractive. In Asia there was increasing interest in low-carbon projects and he expected this to increase further going forward.
Mark Worrall, chief executive of the Estates and Infrastructure Exchange, spoke about the risk profile of global infrastructure projects, an understanding of which was key in improving liquidity. There were tools that could be used to leverage liquidity and make infrastructure investment more attractive and these should be used to encourage more investment. “It is important to have project data that enables people to assess the value of projects and benchmark across similar projects.” Worrall also said that “educating the money” was crucial in influencing bold decision-making and said that accurate project data was crucial.
Also speaking at the launch webinar, Rowan Palmer, programme officer at the United Nations Environment Programme (UNEP), spoke about how FIDIC could work more closely with the UNEP. “Policy makers and planners need to think outside the box. This FIDIC report sets the scene perfectly in framing how organisations can work together on these crucial issues,” said Palmer. He also highlighted the UNEP’s International Good Practice Principles for Sustainable Infrastructure, which sets out ten guiding principles that policymakers can follow to help integrate sustainability into infrastructure planning and delivery. Palmer said that these were focused on integrated approaches and systems-level interventions that governments can make to create an enabling environment for sustainable infrastructure.
Natalie Muir, general manager for water and environment at Cardno, said that it was crucial to drive the sustainability agenda on projects and have the right discussions at the outset. “As engineers it is our role to encourage clients to do the right thing and as trusted advisors, we have a responsibility to do just that. We have got to get as far upstream on projects as possible so that we can influence clients and make an impact on projects at the earliest possible stage,” she said. “The infrastructure challenge brings with it big opportunities for engineers and we need to grasp them,” she said.
Robert Spencer, director for sustainable development at AECOM, highlighted the work of the FIDIC sustainable development committee and the key stakeholders it was looking to influence in the sustainability arena. “We are looking at four key areas to influence - the individual engineers who make crucial decisions, consultancy companies that win the work, FIDIC member associations and FIDIC itself, which has a key and important role to play in influencing and shifting the global agenda,” Spencer said. He said that he was very optimistic, as thousands of companies had signed up to science-based targets and this was enormously encouraging for the future. “The largest engineering consultancies have the scope to make a real difference on environmental footprints – we can make a huge impact,” Spencer said.
Adam Bialachowski, chair of the FIDIC Future Leaders Council and CEO of Vintage Consulting/B-Act, said that there was a massive opportunity from the infrastructure investment challenge, especially for small and medium sized business that can play a key role in the journey towards net zero. He also made the point that for young professionals and future leaders, sustainability was a vitally important issue as they had much to gain from meeting the UN SDGs and other environmental targets.
Summing up the event, FIDIC president Bill Howard said: “Historically, engineers, scientists, physicians and lawyers are really good at talking to each other but less so to wider stakeholders. However, I think that the engineering profession is getting a lot better at communicating about the key issues facing the globe and what needs to be done to address them and it’s great to see us ‘broadening the tent’ in this way. We need to bring together those with the expertise and those with the money so that they can work together to make a real difference.”
The next FIDIC webinar is Improving the capacity of clients in emerging countries on FIDIC contract management which takes place on Tuesday 23 February 2021 at 12 noon CET. Please register your place as soon as possible as we expect another large turnout for this event.
Watch the recording of FIDIC's new State of the World report, Time to $Tn-vest launch event on the link below.
