Investments in infrastructure are again high on the development agenda – is this justified and how can the impact be measured?
„It is one thing to understand that lack of infrastructure is often the principal causal influence on the genesis of poverty, it is quite another to see how attempts at deliberate and organized removal of handicaps of underdeveloped infrastructure may actually make a difference. “(Amartya Sen)
Infrastructure investments in energy, water or transport have experienced a revival in development cooperation in the last decade. It has been generally acknowledged by the international development community that effective, reliable and affordable access to infrastructure services is essential for sustainable development and poverty alleviation. This paper explores the links between infrastructure investments and poverty alleviation and whether this renewed focus on it is justified. For this purpose, the issue of empirically measuring and quantifying impact of infrastructure investments is also discussed. Based on the analysis and review of project documentation and literature a set of best-practices on how to plan and implement infrastructure projects in order to be effective and sustainable has been developed. This developed framework, which highlights the importance of the principles of ownership, capacity building and sustainability (triple-bottom-line performance) has been applied to a case of SECO. Furthermore, an excursus into alternative ways of infrastructure investment targeted towards a macro level impact is provided, by discussing the Chinese approach to development cooperation in Africa. The paper concludes that infrastructure investment, if planned and implemented carefully, constitutes a necessary but not sufficient condition for economic growth as well as poverty alleviation.