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Massive Infrastructure Costs

January 26, 2016

A recently published article concerning Global Water Infrastructure in the World’s major cities speaks of TRILLIONS of dollars needed the next 15 years.

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The USA better wise up rapidly and start funding Water Infrastructure in a big way within its major cities.

https://t.co/UBf3SFycQp
Section 10.2  (quote excerpt)

Cities face the challenges to protect their citizens against water-related disasters (droughts and floods), to guarantee water availability and water quality, as well as to renew and upgrade their infrastructure in response to climate, demographic and economic trends (OECD 2015).

The cost of urban infrastructure is staggering. The UNEP (2013) estimates that for the period 2005–2030 about US$ 41 trillion is needed to refurbish the old (in mainly developed country
cities) and build new (mainly in the developing country cities) urban infrastructures, where the cost of the water infrastructure (US$ 22.6 trillion) has been estimated at more than that for energy, roads, rail, air and seaports put together.

The wastewater infrastructure is responsible for the largest share of these 22.6 trillion. The report also warns that ‘Sooner or later, the money needed to modernise and expand the world’s urban infrastructure will have to be spent. The demand and need are too great to ignore. The solutions may be applied in a reactive, ad hoc, and ineffective fashion, as they have been in the past, and in that case the price tag will probably be higher than US$ 40 trillion.’

To support projected economic growth between now and 2030, McKinsey (2013) has estimated that the investments on global infrastructure need to increase by nearly 60 % from the US$ 36 trillion spent on infrastructure over the past 18 years to US$ 57 trillion over the next 18 years. This is approximately 3.5 % of anticipated global GDP.

These figures do not account for the cost of  addressing the large maintenance and renewal backlogs and infrastructure deficiencies in many economies (McKinsey 2013).

Water goals have big costs but also big returns. Conservative estimates of global investments in a post-2015 water for sustainable development and growth agenda have been estimated (UN
University 2013).

Between 1.8 and 2.5% of the annual global GDP is needed for  implementation of water-related sustainable development goals.

This would also generate a minimum US$ 3,108 billion in additional economic, environmental and social benefits, i.e. a net annual benefit of US$  734 billion.

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