Rethinking Infrastructure in Latin America and the Caribbean: Spending Better to Achieve More
21. April 2017
Latin America and the Caribbean does not have the infrastructure it needs, or deserves, given its income. Many argue that the solution is to spend more. With perhaps the exception of Africa, Latin America does invest the least in infrastructure among developing regions as a share of GDP—less than 3 percent compared with 4-8 percent elsewhere. So the story might seem simple: the region underperforms on infrastructure and has to spend more to narrow its infrastructure “investment gap.” But that story would not match the facts. This report has a different message: Latin America can dramatically narrow its infrastructure service gap by spending efficiently on the right things. It remains to be seen whether spending better will be sufficient for the region to fully achieve what it aspires to. But there is sufficient evidence that spending better and focusing scarce public resources on what matters would significantly narrow the service gap.