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Discussion Paper

Why Connectivity Matters

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May 2018

A draft Discussion Paper developed by the team from the World Bank Singapore Hub leading the GICA Secretariat and featured in the June 2018 Virtual Discussion on LinkedIn.

The idea of connectivity has risen to prominence as sine qua non in the modern economy. Increasing connectivity is one of the defining trends of the 21st century. This is reflected in the increasing demand for resources to be invested in linking communities, economies and countries. In the Asia-Pacific region alone the Global Infrastructure Hub (GIH) estimates that investment in connecting infrastructure will more than double in ten years to reach $2.5 trillion per year by 2020 (Marsh and McLennan 2017). However, the needs remain significant, with the Asian Development Bank (ADB) estimating that Asia-Pacific region needs to invest some $26 trillion by 2030, while the global demand for investment in infrastructure over the same period is estimated by McKinsey Global Institute (MGI) and OECD at between $4.7 trillion and $6.0 trillion per year (MGI 2016; OECD 2018;). Middle-income countries account for about a quarter of this demand (ADB et al forthcoming). There are multiple initiatives to meet the growing demand for transport, energy and telecommunications networks spanning the globe, to lay the basic infrastructure for economic, political and social interactions of even greater intensity.

Connectivity is high on the policy agenda of most countries and global development and financial institutions. With the huge sums of money already being spent or needing to be spent, a question that is often taken for granted is why is it important to enhance connectivity? Why does connectivity matter? This short note offers a succinct answer to this question. After all, while there is little controversy over the resources that need to be invested in connectivity, there are varying expectations of what connectivity is intended to achieve. Suffice to say, improving connectivity is considered desirable as a public good. However, the transmission mechanisms for the impacts it is expected to have on economies, firms and society are at best taken for granted if at all they are explicitly stated.


World Bank Singapore Hub / Global Infrastructure Connectivity Alliance. 2018. Why Connectivity Matters. World Bank Group.


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