About Benchmarking Infrastructure Development

Empirical studies show that every region of the world faces a chronic infrastructure gap. This problem is particularly acute in the low- and middle-income economies where infrastructure “falls short of what is needed for public health and individual welfare, environmental considerations, climate change–let alone economic prosperity or middle-class aspirations” (Rozenberg and Fay, 2019). Moreover, as pointed out by Fay et al. (2019) “the vast majority (87-91 percent) of low and middle-income countries’ investment in infrastructure is undertaken by the public sector” and the infrastructure gap “depends on the countries’ goals and spending efficiency.” Besides promoting private participation in financing and delivering infrastructure, it is equally critical to ensure that traditional public investments are efficient. For this reason, both public-private partnerships (PPPs) and traditional public investments (TPIs) must be undertaken in a fair and transparent environment that enhances competition and contributes to the efficient provision of infrastructure. Furthermore, robust and reliable infrastructure is a key driver of economic growth and improved standards of living by creating networks that facilitate connectivity and remove barriers for access to jobs, markets, information, and basic services.

Appropriate and effective regulatory frameworks and institutional capacity remain crucial for ensuring that investments in infrastructure are done strategically and efficiently. A supportive regulatory framework also reduces the costs and risks of carrying out individual projects. It provides a private sector and foreign investors with a more predictable, stable, and safe environment to invest in infrastructure, which is particularly relevant for emerging markets and developing economies (EMDEs). To assist with the assessment of the quality of the enabling environments in different economies, the use of data-based indicators has been recognized as useful both for shaping public awareness and for supporting government decision-making. The simplicity, communicability, and transparency of such data-based indicators can promote greater consistency in the decision-making process. Well-designed indicators can be influential in attracting the attention of senior policymakers, government officials, and the business community. Having consistent information across countries and over time is also critical to improving the quality of policy dialogue with client economies informed by evidence-based knowledge.

Benchmarking Infrastructure Development 2020 builds on the success of Procuring Infrastructure PPPs 2018, which focused specifically on PPPs, and expands its coverage to include a pilot of 40 economies for TPIs in infrastructure — also referred to as traditionally or conventionally procured infrastructure projects. The initial PPP survey, inspired by the methodology of the World Bank Group’s Doing Business report, was successfully piloted in 10 economies in 2015 with the goal of supporting better policymaking by highlighting the alignment of PPP regulatory frameworks with internationally recognized good practices. The initiative was expanded to 82 economies in 2017 with the support of the Public-Private Infrastructure Advisory Facility (PPIAF) and further expanded in 2018 to cover 135 economies, with the financial and technical support of the PPIAF, the Global Infrastructure Hub (GIH) and the African Legal Support Facility (ALSF). The current 2020 edition has received financial support from the Australian Government Department of Foreign Affairs and Trade (DFAT).

By providing actionable indicators, the Benchmarking Infrastructure Development 2020 report offers a basis for evidence-based regulatory reforms that may improve the enabling environment for development of quality infrastructure projects in different countries. Moreover, the initiative highlights areas for improvement and may guide policymakers in the concerned economies throughout the regulatory reform cycle, serving as a diagnostic tool and a benchmarking instrument against the recognized good practices in the key aspects of a country’s legal and regulatory procurement framework. It also helps fill the private sector’s need for high-quality information in order to become a partner in the delivery of public infrastructure, whether through PPP or a TPI modality. Furthermore, the data may serve the needs of the different stakeholders for information as well as for analytical and policy-making purposes. It is hoped that this report will fuel further academic research, help governments assess their infrastructure governance systems, and deliver a unique information tool for the private sector and civil society.