Global Infrastructure: How To Fill A $500 Billion Hole - Standard & Poor's


An estimated $57 trillion will be needed to finance infrastructure development around the world through 2030, according to a report from consultant McKinsey & Co. Standard & Poor's Ratings Services believes this presents institutional investors with an unprecedented opportunity to fill some of the huge gap created by public-funding shortfalls. Given the many budgetary constraints burdening governments globally, and with banks' long-term lending restricted by regulatory requirements, nontraditional lenders such as insurers and pension funds are poised take a larger share of the infrastructure investment pie.Standard & Poor's estimates that institutional investors could provide as much as $200 billion per year--or $3.2 trillion by 2030--for infrastructure financing, given recent industry-stipulated asset-allocation targets. Although this would represent an ambitious increase versus the historical trend, the gap between investment needs and available public funds could be more than twice that--at around $500 billion annually. 

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