A Progress Report on the Building of the BRICs
Infrastructure in the BRICs has improved notably in recent years, but still remains far behind developed country norms. Infrastructure investment will need to accelerate in the years ahead to prevent it from constraining future growth rates in the BRICs. While recent large-scale plans from the BRIC governments are encouraging in this regard, they will need to do more to attract private investment as well.
Infrastructure is a key determinant of economic growth potential, and thus plays a critical role in our longer-term BRICs’ projections. The BRICs have made some progress in improving the generally weak state of their infrastructure in recent years. However, the degree of progress varies significantly by both country and sector, and levels remain far behind developed country averages.
China and India have experienced the fastest infrastructure growth rates nearly across the board, albeit from low levels. Brazil’s infrastructure is relatively underdeveloped and has not seen the same high growth rates. Russia has much more advanced infrastructure in place than the others due to heavy investment during the Soviet era, but much of this has begun to fall into disrepair due to insufficient investment in maintenance. In terms of specific sectors, the most rapid progress in all four of the BRICs has come in telecommunications, particularly in mobiles and internet.