EAP - The Pacific Infrastructure Challenge - World Bank (2006).pdf

4 Why is Infrastructure Important for Development
There are many factors that contribute to economic growth and poverty reduction.
Governments must balance investment in, and efforts to improve infrastructure
performance with other priorities in health, education, environmental affairs, and
commercial business development.
It is important to debate and establish a
clear set of relative priorities for
government policy in the Pacific. The
purpose of this section is to consider the
factors that may make infrastructure
development the key priority for
economic growth and overall social
development. For example:
Box 4.1: What do we mean by ‘Infrastructure’
This discussion document is concerned with
‘economic infrastructure’. Economic
infrastructure is the construction, operation
and renovation of physical structures that
provide a platform for most other economic
activities. It includes telecommunications,
electricity, water and waste water services;
roads and public works programs, ports and
airports, shipping and aviation services.
In addition to its obvious value for production activities, access to electricity
provides a critical platform for health and education services. For example,
electric lighting creates a better environment for study. Electricity is also
essential for the refrigeration of medical supplies, enabling vaccination and
other public health campaigns to be undertaken
Access to clean water supply not only has an immediate health benefit, but also
frees up the time and resources spent on coping with poor water resources for
other productive activities. In many instances, women bear the brunt of coping
costs, and improved access to water has the most immediate impact on
women’s development
Mobility of goods and people plays an important role in social and economic
development, promoting gains from trade as well as exchange of knowledge.
Hence, roads, ports and other transport infrastructure make a key contribution
to growth
Transport and telecommunications infrastructure is a necessary element of
effective governance in countries with thinly spread and isolated populations.
Economic studies 2 conducted for a wide range of developing countries indicate that well
planned and managed infrastructure makes a strong contribution to productivity growth,
and hence to growth in incomes. While no studies have been carried out specifically for
the Pacific Island nations, there is no reason to believe that the outcomes would be any
different.
Many Pacific country governments specifically acknowledge the importance of
infrastructure in their development strategies and growth policies, as shown in Box 4.2, Box
4.3 and Box 4.4.
2 Relevant studies include: “Connecting East Asia: A New Framework for Infrastructure”, ADB, JBIC, World Bank, March
2005; World Development Report 1994 “Infrastructure for Development”, World Bank
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