How Likely Is Infrastructure Spending Amidst COVID-19 Outbreak?​

Domestically, President Trump and Congress are showing interest in a large-scale infrastructure spending package to create jobs, while globally, a recent survey shows industry leaders are losing hope for increases in infrastructure spending

How Likely Is Infrastructure Spending Amidst COVID-19 Outbreak?​

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Lawmakers on both sides of the aisle have voiced support for more infrastructure spending as a part of the next COVID-19 relief bill — in fact, it’s one of the few things Speaker of the House Nancy Pelosi and President Donald Trump agree on.

The president on Twitter recently said that “with interest rates for the United States being at zero, this is the time to do our decades-long awaited infrastructure bill,” calling for Congress to pass a $2 trillion plan to rebuild infrastructure as Phase 4 of the nation’s coronavirus relief plan.

Democratic lawmakers have put forth suggestions that the bill could include updating drinking water systems, hospital capacity and rural broadband connectivity while creating jobs.

The good news for infrastructure comes shorty after Congress and President Trump passed a $2.2 trillion economic relief package, which was the largest such bill in history.

In related news, the Environmental Working Group recently applauded U.S. House of Representatives leaders for its Moving Forward Framework which makes investments into drinking water pollution a priority.

“Investing in drinking water infrastructure will boost the economy and help get contaminants like PFAS and lead out of our tap water,” says Scott Faber, EWG’s senior vice-president for government affairs. “No one should be drinking polluted water in the middle of a pandemic.”

Overall, House leaders have proposed to spend more than $75 billion on water infrastructure.

House leaders say their coronavirus infrastructure package would expand the Drinking Water State Revolving Fund by $25.4 billion and programs to ensure clean drinking water in schools, day care centers and on Native American reservations. The bill would also fund new, modern clean water and wastewater infrastructure by investing $40 billion in the Clean Water State Revolving Fund.

The bill also aims to establish a new Low-Income Household Drinking Water and Wastewater Assistance program to assist low-income households in paying their drinking water and wastewater utility bills during public health emergencies.

“Too many Americans are drinking water contaminated with chemicals that can damage the immune systems, including PFAS,” Faber says. “We applaud House leaders for making clean water a priority during this time of crisis.”

CG/LA Infrastructure study

Despite the fact that social infrastructure and water projects — including drinking water and wastewater operations — are identified as top priorities from private and public sector entities from around the world, a new CG/LA Infrastructure survey shows that on a global scale, industry leaders are not hopeful about an increase in infrastructure spending following the worldwide spread of the coronavirus.

In its new Global Infrastructure Industry SurveyCG/LA Infrastructure found only 5% believe that investment will “increase significantly” following the pandemic, a sharp decline from 34% before the crisis. In total, only 27% believes that infrastructure investment would increase or increase significantly — a drop from 71%, when asked previously.

Prior to the crisis only 10% of respondents thought that infrastructure investment would decrease (7%), or decrease significantly (3%), but now a majority (52%) believe that infrastructure investment will decline (34%) or decline significantly (18%).

“The data shows that the outbreak of COVID-19 cases worldwide has essentially put a halt to infrastructure investment globally,” says Norman Anderson, chairman and CEO of CG/LA Infrastructure.  “It’s clear that more has to be done — whether it is building more hospitals or schools, or other key projects delivering high quality benefits such as clean water and irrigation systems — particularly in developing countries. Given that infrastructure needs to be a driver of the global economic recovery, obviously these results are deeply troubling.”

Overall, given the lack of public trust in the infrastructure brand, there is an urgent need to address emerging markets infrastructure. Other findings include 28% selected social infrastructure as their top priority, with 55% listing it as one of their top three priorities. Clean water was highlighted as the top priority by 14% and was included in a top three priority by 48% of respondents. Transit and highways (12%) and wastewater (11%) were other top areas cited as in need of investment.  

“As fears around the extent of the global recession increase, it is important that the U.S. government and multilateral institutions understand the depth of this problem,” says Anderson. “Given this acute crisis, now is the time for leadership, an investment model that will allow local economies to recover, and real attention to the benefits that infrastructure brings to people — not just jobs, but health, and a sense of confidence in the future.”

The Global Infrastructure Industry Survey was conducted from March 19-30 to over 13,000 global respondents in engineering/construction, finance, public sector and technology fields. In a separate recent survey, 94% of U.S. infrastructure executives agreed that an infrastructure stimulus was critical for the U.S. to emerge quickly from the current crisis. And 94% of respondents also believe that the U.S. should increase private infrastructure investment. 

The full list of countries that participated in the survey (in alphabetical order) are: Afghanistan, Argentina, Bahamas, Brazil, Canada, Chile, China, Colombia, Costa Rica, Denmark, Dominican Republic, Egypt, El Salvador, France, Georgia, Germany, Guatemala, Indonesia, Iraq, Israel, Italy, Japan, Kuwait, Mexico, Nepal, The Netherlands, Norway, Oman, Paraguay, Peru, Saudi Arabia, Serbia, Singapore, Spain, New Zealand, UAE, Ukraine, United Kingdom, and Uruguay.


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