Skip to main content

Infra Spending In Emerging Markets

Merrill Lynch & Co. has raised its annual infrastructure-spending estimate for emerging markets by 80%, as developing countries try to keep pace with fast-growing economies and large cash reserves, BusinessWeek reported.

Investment in infrastructure, which the firm sees as the long-term solution to inflation, will rise from $1.25 trillion to $2.25 trillion annually over the next three years. And China, the Middle East, and Russia will account for 70% of infrastructure spending.

The report from Merrill Lynch pointed out that Xstrata PLC recently predicted emerging markets would spend $22 trillion on infrastructure in the next 10 years.

“That estimate is among the highest we’ve seen,” the report noted, “with an implied run rate of $6.6 trillion over the next three years.”

The report basically puts to rest the potential slowdown from emerging markets. Just looking at the demand side for building materials and commodities, we can expect prices to remain firm despite some slowdown in developed countries. One caveat though is that although the estimated infra spending in these countries have been revised higher, a lot of it is due to higher materials and related costs, rather than actual number of infra projects. Direct and indirect costs have surged by 40%-200%, so we have to take that into account as well.

Estimated Infrastructure Spending For the Next Three Years


New Estimate

Previous Estimate


$725 Billion

$400 Billion

Middle East

$400 Billion

$225 Billion


$225 Billion

$100 Billion


$325 Billion

$195 Billion


$240 Billion

$110 Billion


$65 Billion

$50 Billion


William said…
these westerner are trying very hard to convince you that the bubble will keep going on forever.

Ha Ha.

Popular posts from this blog

My Master, A National Treasure

REPOST:  Its been more than two years since I posted on my sifu. This is probably the most significant posting I had done thus far that does not involve business or politics. My circle of close friends and business colleagues have benefited significantly from his treatment.

My Master, Dr. Law Chin Han (from my iPhone)

Where shall I start? OK, just based on real life experiences of those who are close to me. The entire Tong family (Bukit Kiara Properties) absolutely swear that he is the master of masters when it comes to acupuncture (and dentistry as well). To me, you can probably find many great dentists, but to find a real Master in acupuncture, thats a whole different ballgame.

I am not big aficionado of Chinese medicine or acupuncture initially. I guess you have to go through the whole shebang to appreciate the real life changing effects from a master.

My business partner and very close friend went to him after 15 years of persistent gout problem, he will get his heavy attacks at least…

Long Weekends

Passengers - Go Watch It

Passengers. Brilliant story telling. Visionary yet believable. Like Martian, only better. Space travel, science, romantic, desolation, philosophical, mortality n its devastation, spectacular imagery. Being human n humane. 9.7/10