Subject Focus: Infrastructure

Infrastructure is central both to the attractiveness of foreign countries as markets and as production locations. For a long time, it was synonymous with the facilities allowing geographical distances to be bridged. Infrastructure was closely associated with passenger and goods transport. But the definition has changed a lot today. Nowadays, infrastructure also refers to the transport of other types of material and immaterial goods, such as energy and information. It therefore includes electricity, gas and telecommunication networks. Other interpretations go a step further, so that the umbrella term infrastructure covers several factors essential to the functioning of an economy based on the division of labor. Along with the above facilities, this wider definition of infrastructure includes the education and research sector, as well as health and sanitation services. In its broadest sense, infrastructure even includes the rule of law and the institutions of civil society.

Given the importance of these factors in firms’ decisions on selecting overseas markets and production locations, infrastructure was the Subject Focus of the BDO IBC Compass in 2014. This led to three additional country classifications for transport, energy and telecommunications. These supplemented the existing sub-indices relating to markets and production locations, and so provide further information to differentiate the overall IBC evaluation.