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Asia’s Key Challenge to Bridge to Infrastructure Gap

First published: BoaoReview, 19/01/2015

Infrastructure boosts short-to-medium term demand,and strengthens supply and trend growth over the longer term. China has taken the lead in stepping up its expenditure on the construction of infrastructure in Asia.

Infrastructure is a hot topic. With many actors of the global economy, including Asian ones, the subject of serial downgrades to GDP and trend growth projections—the IMF devoted a special chapter to it in its recent World Economic Outlook. China has announced some fascinating initiatives designed to strengthen infrastructure spending in Asia. The simple argument for more and better infrastructure is that it boosts short-to-medium term demand, and strengthens supply and trend growth over the longer term. Some countries in Asia could do with the former, but all need the latter. The logistics of making it happen, though, should not be under-estimated…“more:”