Infrastructure Monitor

Infrastructure Monitor 2023 is the fourth edition of our flagship report on the state of investment in infrastructure. It provides an in-depth analysis of private investment in infrastructure projects, financial performance of infrastructure investments, and the availability of private capital raised through infrastructure funds.

Download Executive Summary

Mobilising private capital is key to closing the infrastructure financing gap and has become even more critical as the pandemic and economic and geopolitical shocks have limited the investment capacity of governments. This section analyses private investment in infrastructure projects in primary markets. 

Key takeaways: 

• In 2022, after eight years of stagnation, private investment in infrastructure experienced a post-COVID-19 recovery, increasing across both high-income and middle- and low-income groups.
• There is a clear shift toward cleaner energy. Solar is by far the most common type of energy generation across both income groups.

Download this section

To attract private capital and establish infrastructure as an asset class, infrastructure investments need to demonstrate a strong performance track record. This section summarises the financial performance of global infrastructure equities (listed and unlisted) and infrastructure debt. 

Key takeaways: 

• Recent crises led to an increase in the risk premium associated with infrastructure equities. Risk premiums have gradually declined since 2021 but remain higher than 2019 levels.
• Sharp interest rate hikes in 2022 and 2023 intensified downward pressure on the value of infrastructure equities. Although infrastructure generally offers inflation protection to investors – with varying degrees of protection – all sectors are sensitive to changes in interest rates.
• By 2050, the physical risks posed by climate change could reduce the value of infrastructure assets by up to 27%.

Download this section

Private capital is crucial to addressing infrastructure deficits that the public sector cannot address alone. This year our report tracks the level of private capital raised for infrastructure and how it is being deployed into projects.

Key takeaways: 

• Although 2022 was a positive year for the infrastructure sector, with capital raised by funds reaching a record high, there was a notable downward shift in 2023, reflecting the dynamic nature of the private capital landscape and its sensitivity to economic conditions and global events.
• In 2022, for only the second time in a decade, infrastructure capital investment materially outpaced the infrastructure capital raised.
• Most of the private infrastructure capital raised and invested by funds has been concentrated in North America and Europe.

Download this section

Blended finance is the use of catalytical capital from public or philanthropic sources to increase private investment in sustainable development. This section presents the role of blended finance in infrastructure deals and assesses its effectiveness in bridging the infrastructure financing gap in emerging and developing economies through private capital mobilisation.

Key takeaways:

• On average, commercial capital represented 73% of the financing of blended finance infrastructure deals. Private and non-private sources contributed equally to commercial capital.
• Infrastructure deals attracted $0.4 of private capital for a dollar worth of blended finance approaches, as measured by the central value (median). About 10% of the deals demonstrated exceptional performance mobilising more than $2.
• Blended finance deals were concentrated in the renewable energy sector, and in Sub-Saharan Africa.
• Across sectors, energy storage transmission and distribution, communications, and renewable energy generation sectors had the highest private capital mobilisation ratios. Across regions, Latin America had the highest private capital mobilisation ratio.

Download this section

Environmental, social, and governance (ESG) policies, plans, and disclosures are all connected with the sustainability outcomes of infrastructure. This section examines progress made across all three ESG pillars and highlights where improvements are needed to ensure infrastructure is sustainable and infrastructure investments are ESG aligned.

Key takeaways:

• In 2023, infrastructure assets continued to improve their ESG policies, practices, and disclosure, across all three pillars (environmental, social, and governance). While Governance saw the most improvement, overall, it still lags behind the Social and Environment pillars.
• 60% of infrastructure assets currently have a net zero target, but only one third have one that is science-based or aligned to a net zero target-setting framework.
• Most infrastructure assets have a systematic process for identifying and assessing the financial impact of physical climate risks, with more than two-thirds concluding that there are material direct or indirect financial impacts.

Download this section