year (4.5–8.2 percent of their combined GDP) between 2015 and 2030 to meet infrastructurerelated SDGs, depending on policy choices (Rozenberg and Fay 2019).

Costing exercises have also been carried out by other international institutions, but the results are not easily comparable.<sup>3</sup> The IMF estimates that additional spending of about $1.3 trillion (2016 US$) per year during 2019–30 is required to make meaningful progress toward the SDGs related to infrastructure in low-income developing economies and emerging market economies combined, and another $1.3 trillion for the SDGs related to health and education (Gaspar et al. 2019). The UN estimates that $5 trillion to $7 trillion per year between 2015 and 2030 is needed to achieve a set of SDGs globally, with the estimates being $3.3 trillion to $4.5 trillion per year in developing countries, mainly for basic infrastructure, food security, climate change mitigation and adaptation, health and education (UNCTAD 2014). The World Health Organization (WHO) estimates the additional annual investment needed to meet the SDG on health in low- and middle-income countries is about $370 billion (Stenberg et al. 2017; WHO 2017). The Food and Agriculture Organization (FAO), the International Fund for Agricultural Development (IFAD) and the World Food Programme (WFP) jointly estimate that an average of $265 billion per year is needed during the period 2016–30 to sustainably end hunger (FAO, IFAD, and WFP 2015).

Although they are useful starting points for fiscal authorities and for donors, typical cross-country benchmarking exercises can be misleading, for several reasons:

- _Double counting._ Costing exercises using an accounting approach can double-count investment needs by ignoring synergies across different types of investment and across countries. For example, improvements in water and sanitation infrastructure can reduce child mortality. Improvements in health indicators can reduce poverty, and vice-versa. In South Asia, differences in seasonal patterns of energy supply and demand across countries implies that unrestrictive cross-border energy trade would reduce the need for building new power plants (Timilsina et al. 2015). In addition, benchmarking exercises do not attempt to optimize the supply of infrastructure, and typically do not consider the sensitivity of estimates to assumptions about growth and socioeconomic challenges, such as the effect of the migration of large numbers of people across national borders on demand for infrastructure services or the growing impact of natural disasters in many countries.

- _Operation and maintenance costs and discounting._ Many SDG costing exercises do not consider the operation and maintenance needs related to infrastructure, nor are the estimates discounted in a consistent manner. Operation and maintenance costs are significant, especially in the transport and water and sanitation sectors (Rozenberg and Fay 2019). These costs are expected to represent an even larger share of infrastructure investment needs as the number of unserved people falls in the future, and with it the cost of initial capital investments (Hutton and Varughese 2016).

> 3 The cost estimates provided by the WBG, IMF, and UN are not strictly comparable due to differences in country samples, subsectors (e.g., low-carbon transport in the WBG study—rail and bus rapid transit—versus only roads in the IMF study), and use of discounting, among other things. They also largely differ in their assumptions about initial conditions and other contextual factors under consideration, which do not allow a systematic comparison among various estimates.

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