Quality Growth and Quality Infrastructure Investment

This chapter presents an example of policy proposals for achieving quality growth, with a focus on the infrastructure sector. Infrastructure has positive externalities that accelerate development, and its physical stock has generally shown a positive relationship with growth. The Japanese government began promoting “quality infrastructure investment” (QII) in the mid-2010s. The background of this initiative was the increase of global demand for infrastructure funding and the growing need to address global issues such as inequality, climate change, and disasters. QII is an investment principle that addresses these, with its pillars comprising measures to promote growth through the efficient use of funds, including public investment management, as well as measures to enhance inclusiveness, sustainability, and resilience. The proposed policy framework for realizing QII consists of four elements: first, the establishment of national targets to promote inclusiveness, sustainability, and resilience through infrastructure; second, new investment standards that take these considerations into account; third, improvements in public investment management; and fourth, adequate budget allocation for maintenance and rehabilitation, with a particular focus on life-cycle costs, a fundamental issue for sustainability in the infrastructure field.