Infrastructure Index - America Overview

Creating an attractive environment for investors in infrastructure is no easy task. Politics and policy can make or break private participation and the flow of investment. Something that has never been clearer than in this year’s CMS Infrastructure Index which ranks 40 jurisdictions in order of infrastructure investment attractiveness.

This supplement focuses on the Americas. 

Canada is reaping the benefits of its government’s focus on infrastructure and ranks second in the Index.  It wins its position thanks to clear procurement procedures, a large PPP pipeline and an established investment community.  Prime Minister Justin Trudeau will launch the Canada Infrastructure Bank (CIB) by the end of 2017 and has promised to spend CAN$187bn on infrastructure over the next 12 years.  Political support of the CIB is mixed and this may impact the project pipeline, but Canada is undoubtedly a hot spot for private capital. 

The United States ranks seventh in the Index.  It has a decentralised approach to infrastructure and PPP and much of its existing infrastructure is in desperate need of an upgrade.  President Trump has promised a US$1trn infrastructure plan but until the details are released, the opportunities for investment are uncertain. 

Chile is the highest ranking South American country and ranks 11^th in the Index.  It is a global pioneer of PPAs and has benefitted from its strong governance and stability and a favourable tax environment.   The pipeline of projects across other Latin American countries also presents opportunities for investors: Mexico has just announced 12 new projects, Colombia has an ambitious roads initiative and Brazil has embarked upon a major privatisation programme. 

The South American countries included in the Index are focusing much of their attention on energy and transportation.  Recent natural disasters, such as the recent earthquake in Mexico in September 2017, have also created a new and urgent need for basic infrastructure to be repaired and replaced.  Private capital will be an important component in meeting this need. 

The Index presents a positive outlook for the Americas.  There are huge opportunities across the whole region, but some will require more appetite for risk than others.