Infrastructure for Competitiveness and Social Welfare

In the sector priority of Infrastructure for Competitiveness and Social Welfare, the Region has made considerable progress in accessing basic services such as water and sanitation and electricity. Between 1995 and 2015, 220 million people gained access to water and sanitation. During this period the percentage of the population using improved drinking water increased from 93 percent to 95 percent. Challenges remain, however, with 34 million people continuing to lack drinking water, 106 million lacking adequate sanitation, and 19 million still practicing open defecation.

The Region is also very close to achieving universal access to electricity. By 2014, the proportion of households with electricity was 96 percent, a 3 percentage-point increase since 2007. However, the percentage of people with access to electricity varies widely from country to country and between areas within a country. The challenge of connecting 26 million of people who still lack access, and 87 million people that do not have access to clean and modern cooking fuels, requires a combination of off-grid and on-grid solutions.

By building and maintaining key infrastructure for connectivity and logistics, Latin America and the Caribbean is helping to enhance its competitiveness. Still, by the end of 2015, only 38 percent of the total road network was paved. The quality of the Region’s overall transport infrastructure lags behind with a score of 3.5 out of 7, when compared with countries from the Organisation for Economic Co-operation and Development (OECD), whose average ranking was 5.5. Road safety also represents an important challenge, where 17.2 per 100,000 people in the Region are victims of road traffic fatalities. Moreover, access to efficient transportation systems that are resilient to climate change is critical for the future development of urban areas.

Infrastructure projects represented a sizable portion of the IDB’s work with the Region in 2012-2015, with investments in infrastructure comprising 39 per cent of the total amount approved for SG loan operations. More than 200 projects in 24 countries contributed to this sector priority. Story 2.3 portrays the benefits of a project that improved the sanitation conditions in Managua and four neighboring municipalities. Story 2.5 shows how the expansion of access to electricity benefited milk producers in Ecuador.

Only two of the five targets in this sector priority were met (Indicators 3.2.4 and 3.2.5 in Figure B.2). There are two reasons, specific to infrastructure projects, which explain why targets were not met. First, unforeseen delays in project execution affected achieving targets in Indicators 3.2.1 and 3.2.2 (see Figure B.2); including delays in land acquisition and soil characterization. These two indicators achieved 34 percent and 45 percent of their targets, respectively.

Second, the nature of IDB’s transport portfolio shifted from maintenance and rehabilitation interventions of rural and secondary roads to larger and more complex infrastructure interventions (see Box 2.1). Story 2.4 features one of 75 projects contributing to Indicator 3.2.3, for which 53 percent of the target was achieved. The story describes how an emergency program approved soon after Hurricane Sandy hit the southern regions of Haiti helped rehabilitate inter-urban roads.

Figure A.2
Regional Development Goals:
Infrastructure for Competitiveness and Social Welfare
Figure B.2
2012–2015 Output Contribution Indicators:
Infrastructure for Competitiveness and Social Welfare

Development Stories

Story 2.3
Strength and Coordination

Story 2.4
Rebuilding with Local Force

Story 2.5
Cows and Kilowatts