Insights

Infrastructure project preparation capacity is weak across most regions of the world. It is critical to strengthen these capabilities to address one of the major bottlenecks in attracting private capital to infrastructure, which is the lack of a bankable, investment-ready pipeline of infrastructure projects

For investors seeking to diversify and optimise their portfolios, infrastructure debt and unlisted infrastructure equities are very strong options, according to long-term data

Unlisted infrastructure equities have provided higher risk-adjusted returns to investors than an average global listed equity. With greater recognition of its attractive performance, investors’ demand has increased, and returns have aligned over time with its lower risk or volatility

Infrastructure debt has a highly attractive and resilient risk-return profile for investors. Expected losses are particularly low given high recovery rates in cases of default

Private investment in infrastructure projects in primary markets has been stagnant for seven years running

Private investment in infrastructure projects in primary markets was resilient to COVID-19 pandemic shocks

Public investment in infrastructure is more effective in increasing economic output than other types of public spending

Investment in public transit infrastructure can contribute to creating more inclusive societies. Public transit services are more often used by lower-income households, women and ethnic minorities.

Regulatory capital frameworks require banks and insurers to put aside more capital for infrastructure investments than is warranted by their historical credit performance

Infrastructure equities have an attractive risk-return profile providing a competitive alternative to other investment options.

Merchant infrastructure, larger investors and the transport sector have experienced larger declines in returns due to COVID-19.

Social infrastructure is the best performing segment among all country income groupings, according to new data from Moody’s that provides insights into the debt performance for infrastructure industry sector. Social infrastructure includes healthcare, education and public (community housing, prisons) facilities. The data also reveals transport and energy infrastructure perform differently in relative terms for depending on country income grouping.

The highest recoveries on infrastructure debt default occurs in Africa, the Middle East and Eastern Europe, according to new data from Moody’s shows which regions of the world have the highest and lowest default rates on infrastructure and other project finance debt investments.