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Infrastructure Productivity: How to Save $1 Trillion a Year

By McKinsey Global Institute

Across the world, inadequate or poorly performing infrastructure presents major economic and social challenges that governments and businesses need to address. Without the necessary infrastructure—from transport systems to electricity grids and water pipelines—economies cannot meet their full growth potential and economic and human development suffers. Yet the imperative to invest more in infrastructure comes at a time when many governments are highly indebted and face competing calls on their scarce resources.

The size of the infrastructure gap and concerns about how to find the money to fill it are the linchpins of current debate on this issue. But this focus overshadows what we believe to be an equally compelling  imperative—to improve the planning, delivery, and operation of infrastructure to get more, higher-quality capacity for less money, and to boost infrastructure productivity. Infrastructure productivity: How to save $1 trillion a year, a new report from the McKinsey Global Institute (MGI) and the McKinsey Infrastructure Practice, is the first in a series of planned reports on infrastructure. Our research raised several questions that we have not addressed in detail in this report and that we aim to address in future. These questions include the national balance sheet and financing of infrastructure, the challenges and opportunities faced by private-sector players, how to address the capability gap, the role of new technologies, and green infrastructure…

Please click to view the full report.

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