WASHINGTON, April 24, 2023—New World Bank data finds that infrastructure investments in low- and middle-income countries continued to rebound in 2022. Private participation in infrastructure (PPI) commitments reached $91.7 billion across 263 projects, marking a 23% increase from 2021. The total number of projects, however, was still below pre-pandemic levels.
“As the world is staggering out of multiple crises, we are pleased to see that early signs of investment recovery continue to hold,” said Imad Fakhoury, the World Bank’s Global Director for Infrastructure Finance, PPPs & Guarantees. “At a time of tightening public budgets, the world has no choice but to mobilize the private sector to invest in green, resilient, inclusive and climate-smart quality infrastructure. Doing so is crucial to support the transition to net-zero carbon economies and fulfillment of SDGs as well as protect societies from mounting climate-related risks, and achieve universal access to basic services for millions of households who remain excluded.”
While the trends suggest an overall recovery, investments were concentrated in five countries: China, Brazil, India, Indonesia, and Vietnam captured $68.3 billion in investments, or 75% of the global total.
Investments were also uneven across regions. PPI commitments increased in Latin America and the Caribbean and East Asia and the Pacific, with increases of 16 and 17 percent, respectively. South Asia received an impressive $13.9 billion in private sector investments in 2022, the highest in the past 10 years and over 15% of total commitments.
In contrast, Europe and Central Asia saw the lowest private investment commitments in the past decade. The downturn is mainly due to Russia’s invasion of Ukraine, with neither country reporting any PPI projects for the first time in five years. Sub-Saharan Africa also saw a 15% decrease in investments compared to the past five-year average. Nevertheless, the number of projects and countries in the region with PPI transactions were the highest in the past decade.
When it comes to the world’s poorest countries, eighteen countries that are members of the International Development Association (IDA), received investment commitments amounting to $4.7 billion across 30 projects in 2021. This represents more than a 26.1% increase in investment levels compared to 2021, but also a 22% lower investment level than the past five-year average of $6.1 billion.
The transport sector continued to lead the sustained recovery into 2022, outpacing other sectors significantly. At $66.2 billion in PPI investment across 85 projects, transport comprised 68% of the total 2022 PPI investment. This increase can be explained by more investment in roads, which have historically been the largest subsector in transport commitments.
The energy sector also gained a significant share of PPI in 2022, with a 21% increase for a total of $25.9 billion. Investments were increasingly focused on environmentally sustainable options—85% of new energy projects were in renewable energy, compared to an average of 63% over the last five years.
Importantly, in 2022, the PPI database started collecting data on electric vehicle charging stations. Tajikistan’s Dushanbe E-Mobility project, a leading initiative in the country’s electric mobility transition, is a notable example.
Private sources contributed to 50% of the financing to PPI projects. Another 35% came from public sources, and 15% of financing from development and export finance institutions (DEFI)—which accounts for 26% of all PPI projects, marking an increase from both 2020 and 2021.
