The aging infrastructure of many Western nations may not be the most exciting or lively topic to discuss in economics, but it plays a crucial role. Infrastructure investments play a critical role in long-term economic growth, job creation and economic competition in an increasingly globalised world.
Infrastructure investments are key to economic growth both in the short and long-term as they will assure Western economies stay competitive with emerging rivals such as China, India and Brazil. Below we elaborate on 3 primary reasons Western economies must heavily invest in their infrastructure.
Infrastructure Investments Boost Job Creation and Spur Economic Activity
One of the primary short-term benefits of properly investing in infrastructure is the potentially millions of jobs that could be created. According to a report by TheCityUK, improving the European Union’s infrastructure could lead to the creation of up to 1.1 million new jobs and greatly spur new economic growth across the Eurozone over a period of just a few years. The creation of both direct and indirect jobs via infrastructure improvements can help to drastically lower unemployment and spur renewed economic growth across the UK and the rest of the European Union.
Bolstering Infrastructure Boosts Long-Term Economic Growth
In addition to creating jobs in the short-term, infrastructure investments is crucial to the long-term economic growth of Western nations. A nation with crumbling roads, clogged seaports and airports and a sluggish rail network cannot possibly hope to grow its economy with the future in mind. Indeed a crumbling national infrastructure potentially means billions in lost GDP growth for years to come. Yet by investing and modernising infrastructure with the future in mind, nations can develop a comprehensive and forward-thinking national growth strategy that allows for renewed economic growth in the decades to come as well as addressing infrastructure challenges in the near future.
Infrastructure Improvements Help Western Nations Compete in a Globalised Economy
While immediate job creation and bolstering long-term economic growth are certainly benefits of properly investing in infrastructure, these investments also play a key role in global competition. Western nations face new competition from emerging titans like China and India in the 21st century global economy and must develop a cohesive, bold economic strategy to compete against them. According to Lagan Construction Group, investing in airports, roads, bridges, seaports, rail infrastructure and the like, Western nations can afford to grow their economies for the future with global competition in mind.
For example, new investments in Heathrow Airport are expected to be a boon to London and South East England, offering the chance to modernise the airport, accommodate new international passengers and help the region compete in a global level.
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