Infrastructure

Journal Article - Link (English) - 2025

Over the last four decades, the provision of economic infrastructure in Latin America and the Caribbean has been marked by significant contrasts, reflecting the region's high political, economic, and social volatility. Despite notable progress, the region still faces substantial challenges compared to other regions and its domestic requirements. Limited information on quantitative and qualitative infrastructure indicators and investment hampers comprehensive analysis.

Research focused on the region highlights the critical role of infrastructure in promoting economic growth, reducing inequality, and alleviating poverty. Studies demonstrate that inadequate infrastructure investment has significantly hindered the region's economic development. Furthermore, there is a growing need to broaden the definition of infrastructure and improve its measurement to reflect its economic impact better.

To achieve long-term growth and development, the region must prioritize the adequate provision and access to infrastructure and its associated services in terms of quantity and quality within a framework of adequate and stable regulations. This approach aligns with the strategies of currently advanced economies and is essential for addressing the region's economic and social challenges.

Book - Link (Spanish) - 2024

The relationship between infrastructure and economic growth has been intensely studied since the 1990s without a clear consensus on its long-term impact. Recent literature suggests a positive effect, although there is considerable variability due to differences in the type of infrastructure analyzed, their measurement, and the control variables. This book analyzes five Latin American countries to estimate the impact of infrastructure on economic growth in both physical and monetary terms. The results show a positive and significant impact of infrastructure investment on growth, taking into account possible endogeneities and econometric challenges. Additionally, the book addresses topics such as the definition of infrastructure, measurement issues, green infrastructure, its relationship with inequality, and the resilience of critical infrastructures.

Journal Article - Link (Spanish) - 2024

Over the past fifty years, the economic growth in Mexico has been slow and volatile, partly due to the fluctuating evolution of gross fixed capital formation, which is affected by economic performance, especially during recessive periods. This study, covering the period from 1980 to 2020, finds a positive and statistically significant, though small, relationship between public infrastructure investment (PII) and the growth of the private sector GDP. At the sectoral level, positive effects of PII are found in all sectors except for energy. The results indicate that PII alone cannot sustain economic growth but should be part of a comprehensive long-term strategy that includes partnerships with national and foreign private investments.

Working Paper- Link (Spanish) - 2022

Economic infrastructure in Latin America has shown a decreasing trend since the retraction of public infrastructure in the eighties. The reduction in investments favored an infrastructure gap that needs to be attended to. Recent concepts such as green infrastructure and natural capital should be considered when providing an effective response to the infrastructure gap. The present article deals with these issues.

Journal Article - Link (English) - 2021

This paper examines the global rise in vessel size and predicts the arrival of larger ships on South American coasts. Analyzing data since 2006, it identifies factors driving the trend towards larger ships (18,000-24,000 TEU). The study highlights infrastructure, economics, technology, and environmental factors as key drivers. Using models with thresholds of 1310 ft LOA and 18,000 TEU, the paper applies an econometrics methodology to Latin American trade, emphasizing the need for strategic infrastructure planning and investments to address issues like economies of scale, concentration, and entry barriers. Efficient medium-term planning in the port industry is crucial for maximizing economic impact.

Report- Link (English) - 2020

This report presents different forecast methodologies, all of which point to the arrival of large ships within this decade. These models identify the future determinants of the increase in the size of large ships, highlighting the infrastructure-related factors that limit growth in ports and shipping lanes and others related to environmental requirements that drive the increase in the size of large ships.

Working Paper- Link (Spanish) - 2015

Public investment is a fundamental tool for the economies of Latin American and Caribbean countries. Therefore, it is essential to allocate limited public resources appropriately with transparent criteria and sound methodologies. This document summarizes general and sectoral methodologies used by countries in the region for social project assessments. The goal is to foster cooperation and technical support among the members of the National Public Investment Systems (SNIP) network.

Working Paper- Link (Spanish) - 2015

The National Public Investment Systems (SNIP) in Latin America has made significant progress in recent years, with more projects evaluated and higher unit costs approved. However, there are still areas for improvement, such as strengthening institutional frameworks, increasing access to information for civil society, expanding the use of social pricing in project evaluation, and providing continuous training for human capital. These findings, presented in this document, come from a 2014 survey of members of the SNIP Network, created in 2010 to strengthen these organizations through the exchange of experiences and cooperation.

Book Chapter - Link (English) - 2014

Several determinants strongly influence the pricing in shipping markets, with key factors including the shipping cycle, imbalances between routes, volatility, input prices, cost of capital, and regulatory issues. Additionally, agent behavior is linked to expectations, technical variables (e.g., economies of scale, scope, and density), competition levels, market concentration, entry and exit barriers, and collusive agreements, which also play significant roles. While supply and demand are fundamental in pricing, maritime economics literature often lacks a clear interaction of these later elements under a price-quantity equilibrium system. This chapter aims to identify pricing determinants by a system of simultaneous equations to account for potential endogeneity. Variables such as marginal cost, actual fleet, interest rate, fleet size, expectations, imbalance, and GDP are considered. The findings provide a deeper understanding of the pricing phenomenon, especially in the context of economic cycles.

Journal Article - Link (English) - 2012

In recent decades global and regional economic growth has significantly transformed the maritime transport sector, ports, and logistics. Increasingly larger ships are being used for container transport, which strategically impacts port planning and related activities. Historical data shows that large vessels on major trade routes are reaching South American coasts more quickly. This paper aims to predict when the largest current vessels (average 13,000 TEUs) will regularly arrive in South America. Using models with variables such as maritime trade, global economic activity, time spans for vessel appearance and coastal characteristics, it is estimated that these large vessels would likely reach South America regularly between 2016 and 2020. These findings underscore the importance of efficient medium-term port planning to maximize economic benefits for the region.

Working Paper- Link (Spanish) - 2011

Economic infrastructure is crucial for reducing poverty and achieving sustained economic development. In recent years, investment in infrastructure in Latin America and the Caribbean has declined, creating a significant gap between needs and actual provision. This document uses alternative methodologies to quantify this gap and determines that an annual investment of around 5.2% of the regional GDP (approximately $170 billion in 2000 dollars) is needed to meet the demands of businesses and consumers between 2006 and 2020. To reach the per capita infrastructure levels of some Southeast Asian countries, the required investments would rise to 7.9% of GDP (about $260 billion in 2000 dollars) annually. The required effort is substantial given that observed investment in 2007-2008 was only 2% of GDP. However, adequately addressing these needs will be crucial for the region’s integration into the global economy in the 21st century and for improving the quality of life of its inhabitants.

Report- Link (English) - 2011

The main objective of this report has been to measure the infrastructure gap and the investments needed to close both the horizontal and the vertical gap. Latin America and the Caribbean will have to invest around 5.2% of the region’s GDP annually in order to meet the needs of companies and individuals between 2006 and 2020, assuming an average annual economic growth of 3.9% during this period. If, however, the intention were to close the gap with a group of East Asian countries, expenditures would have to rise to 7.9% of annual GDP.

Report- Link (English) - 2011

This policy discussion brief is a joint response by the Inter-American Development Bank (IDB), World Bank, and United Nations Economic Commission for Latin America and the Caribbean (ECLAC) to a request made by Ministers during the Third Meeting of Finance Ministers of the Americas and the Caribbean, held in Lima, Peru, on May 28, 2010.