Governments Face Significant Issues in Infrastructure

7-governments face significant issues


With few exceptions, under investment in infrastructure has been a global secular trend. In some instances the true economic cost is not passed on to consumers. In these situations, under-pricing tends to be subsidized by the government, which results in pressure on government finances. The cumulative adverse impact is under investment, lagged maintenance and inadequate infrastructure replacement. This in turn slows development, erodes productivity, and in some cases results in shifts of populations and industries to more infrastructure efficient geographic areas. Estimations and methodologies to determine infrastructure funding needs differ due to varying definitions of infrastructure as well as the level of subjectivity involved in assessing the need to renew, maintain or to add to existing assets. The market for private investment in public infrastructure is expected to continue to grow in size, sophistication and opportunity. Private investors recognize this trend and have begun to raise dedicated infrastructure funds to address these opportunities. These infrastructure funds bring together capital from a variety of investors and allow for efficient deployment of equity capital.

Author: Sameer_Jain

Partner. Sameer Jain is founder of FinTech, the world’s first portal that seamlessly integrates traditional, illiquid and alternative investments within portfolios. Prior to this he was Chief Economist & Managing Director at AR Capital. Before that he headed Investment Content & Strategy at UBS Alternative Investments. At UBS, he served as a non-voting member of the Wealth Management Research investment committee, and as a capital allocator was responsible for all illiquid investing including fund manager selection and due diligence across the platform. Prior to UBS he headed product development & investment research at Citigroup Alternative Investments that managed over $75 billion of alternative investments across hedge funds, managed futures, private equity, credit structures, infrastructure and real estate. Here he led a team that developed proprietary models for portfolio strategy and asset allocation with alternative investments, provided investment support and research to pension plans, sovereign wealth funds, endowments as well as internal clients including Citi Private Bank. Before this he was with Cambridge Alternative Investments and SunGard (System Access) where he travelled to over 80 countries for work across Europe, Asia, Middle-East and Africa. He has written over 30 academic and practitioner articles on alternative investments with thousands of downloads at SSRN, presented at over a hundred industry conferences and has coauthored a book, Active Equity Management. Mr. Jain has multiple degrees in engineering, management, public administration and policy and is a graduate of Massachusetts Institute of Technology and Harvard University. He is a recipient of the Alfred Sloan Fellowship and subsequently was a Fellow of Public Policy and Management at the Harvard Kennedy School of Government for a year. He holds Series 7 and 66 securities licenses.

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