Ideas for Developing Asia and the Pacific

The Spillover Effects of Infrastructure Investments

Video | 09 March 2016

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Many Asian countries need infrastructure investment. However, the economic impact of such investment was not well computed in the past. ADBI Dean Naoyuki Yoshino talks about the need for greater infrastructure investment in highways, bridges, ports and so on in the region.

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Title: The Spillover Effects of Infrastructure Investments

Description: Many Asian countries need infrastructure investment. However, the economic impact of such investment was not well computed in the past. ADBI Dean Naoyuki Yoshino talks about the need for greater infrastructure investment in highways, bridges, ports and so on in the region.

Naoyuki Yoshino
Dean
Asian Development Bank Institute

Many Asian countries need infrastructure investment—highways, bridges, ports, and and so on. However, their economic impact was not well computed in the past.

At the same time, their rate of return was not large, that’s why bankable projects were scarce.

ADBI completed the research to compute those spillover effects coming coming from infrastructure investments.

When a highway is completed, many companies can locate along those highways, they can sell their products, and employment in the region will benefit; small businesses can start restaurants and so on. Those impacts are called spillover effects after the completion of highways or railways.

ADBI has computed those impacts in the case of a highway in Manila, Philippines, and railways in Uzbekistan and Japan and other cases. And if these spillover effects are returned to the infrastructure investors, the rate of return will be much higher.

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