Why the time has come to invest in infrastructure
Infrastructure projects supervisor at MAPFRE
The economic resources required to meet these needs on a global scale far exceed the funding available to any government, which is why governments and public administrations at all levels are the first to support private initiatives to deliver these essential aspects, starting by approving the appropriate legislation. This explains why infrastructure is currently being supported by both public and private interests, meaning investing in these assets worldwide is now more secure. If we also consider the macroeconomic situation that faces us, with low interest rates and investment products with adjusted returns in highly competitive markets, infrastructure investment provides a breath of fresh air for any portfolio. If we compare risk-free investment products—the current return on which is almost non-existent—with alternative infrastructure investment products—which provide much more attractive returns—it is at least worth considering investing in infrastructure.
During the ongoing global health crisis, infrastructure investment products have shown great resilience to changes in the economic cycle. In other words, there is a clear consensus, which I support, that they have become a safe haven investment. Throughout this period, these investment products have continued to yield adequate returns because, despite the poor performance of economic indicators, demand for infrastructure has remained high as meeting basic needs such as electricity, transport, water, technology, health etc. has been prioritized. This poor correlation between infrastructure investment and other more conventional investments makes the former an attractive and necessary product in a globalized and unpredictable world such as ours. It is the ideal addition to any investment portfolio.
One important point we should not forget is that, in a world where technology is advancing at breakneck speed and where immediacy has become almost a necessity, it’s very important to have the support and knowledge of multidisciplinary experts to accompany us throughout the process and give us peace of mind that our investments are in the best hands.
Investing in infrastructure is not only investing in assets, but also in development and excellence, in job creation, in helping to reduce the carbon footprint and in improving quality of life. All that in itself sounds like a lot, but when coupled with potentially attractive returns, it is definitely an asset class worth exploring.