Innovation risk and reward in infrastructure

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Procurement can be used to help drive innovation and the uptake of new technology in the global infrastructure sector.

What role can procurement play in driving innovation in the global infrastructure sector and what are the risks to consider? Maria Eugenia Roca from the Inter-American Development Bank offers her thoughts.

You’re speaking at the FIDIC conference session in Mexico City on “Innovation and the role of procurement in new technologies”. What are some of the key points you will make?
That public procurement represents a significant part of national economies, around 20-30% of GDP, and modern public procurement is a key field to use new technologies in order to improve the provision of services to citizens, increase transparency and introduce greater efficiency and economy.

What are the potential benefits of digitalisation?
Better provision of services to citizens. There is a great potential in Latin America and the Caribbean to improve infrastructure services though innovation. This is a critical moment because technologies have evolved, becoming very competitive and creating opportunities to deliver sustainable infrastructure assets and provide better services. Digitalisation can also help to improve urban planning by optimising routes for transport operators, reduce commuters’ journey times and provide educational support to students based on their individual learning needs. More transparency and more access to information to civil society reduces the risk of corruption, creating new solutions to transform the way governments usually operate, reducing bureaucracy. Innovation can be used in all stages of the project cycle.

What are the new risks that digital infrastructures, business and distribution models and customer solutions pose?
Given limited fiscal spaces for public investment, the difference in information between government and private sector, as well as the rapid obsolesce of technologies, are new risks. Digitalisation is both a difficulty and a helpful tool for governments. As governments embrace digital technologies, innovative solutions and become more interconnected with partner organisations and smart devices, this can be exploited by cyber attackers. Better data sharing provides a sophisticated means of combating threats, but citizens are becoming increasingly concerned about the way their data is being used.

Is cyber security and fraud an increasing risk as a result of more digitalization?
Access to the internet and broadband services increase productivity, national income, and employment.
Access to information catalyses growth. But these opportunities come with risk. When digital technologies are not mature, they can be easily exploited by criminals and other antagonists. The question for public policy is how countries can manage risk without sacrificing opportunity.

How is your organisation preparing for the digital future in the way that it works with partners?
The IDB has worked for the past few years, to support LAC countries on project pilots, knowledge development and research and capacity building and training. In infrastructure, for example, Bolivia created Infradinamica, a project that combines ‘BIM drones’ and crowdsourcing to monitor construction online. Another example is the use of big data in Metro de Quito, Ecuador, and AI to improve urban logistics. I will talk about more of this work at the conference in Mexico City.

MarĂ­a Eugenia Roca is the procurement advisor at the vice presidency for Latin American and Caribbean countries at the Inter-American Development Bank.