How strong infrastructure governance can end waste public investment
COVID-19 has had a profound impact on people, firms, and economies all over the world. While countries have ramped up public lifelines to individuals and firms they will face enormous challenges to recover from the pandemic, amidst low economic activity and unprecedented levels of debt.
Public infrastructure investment will play a key role in the recovery. But with resources tight, governments need to spend taxpayer money wisely on the right projects. For this, countries need good infrastructure governance—strong institutions and frameworks to plan, allocate, and implement quality public infrastructure.
Done right, public investment to stimulate weak aggregate demand can help boost more inclusive growth, reduce inequalities, and create economic opportunities for all. Investment in health systems, digital and environmentally-conscious infrastructure can improve people’s lives, connect markets, and improve the resilience of countries to climate change and future pandemics.
Countries will also need to increase public investment to attain the Sustainable Development Goals (SDGs), while advanced economies need to tackle aging infrastructure like roads, bridges, and healthcare systems.
But every dollar spent has to count, and when spending more on infrastructure, countries also need to spend better and smarter to get the most bang for the buck.
The article is by the International Monetary Fund (IMF)