Metro Manila (CNN Philippines, May 2) — Members of the Association of Southeast Asian Nations (ASEAN) must invest at least $184 billion annually in infrastructure to meet their economic goals and respond to climate change, according to the Asian Development Bank (ADB).
In a report released on Tuesday, the ADB said this translates to investments totaling at least $2.8 trillion from 2023 to 2030.
“Rapid economic development, urbanization, and population growth in the (Asian) region have resulted in an ever-widening gap between current spending and finances required to meet the increasing demand for infrastructure,” the regional bank said.
“Closing the infrastructure gap is critical for ASEAN plus the People’ s Republic of China, Japan, and the Republic of Korea (ASEAN+3) to fulfill their commitments toward Sustainable Development Goals (SDGs), improve competitiveness, and address environmental challenges,” its report also read.
The ADB noted that its estimates do not yet cover extra expenditures linked to disasters and extreme weather events that increasingly affect existing infrastructure in the Philippines and the rest of Southeast Asia.
Meanwhile, for the Asia and Pacific region, the bank said an investment of $13.8 trillion or $1.7 trillion yearly is needed until 2030 to meet its social infrastructure requirements over the next 15 years.
According to the ADB, private sector participation is key in narrowing the financing gap, as it noted that constrained public finances due to higher energy costs and reallocation of funds have further cut government spending on infrastructure development.
The bank added that innovative financing mechanisms can help in injecting much-needed capital.
“Innovative financing mechanisms are needed to attract private and institutional capital — along with public funds — to fund critical infrastructure that will create jobs and generate revenue for local economies,” ADB Managing Director General Woochong Um said.
