By Zuo Zhuanwen
 

 

　　As soon as the new U.S. President Trump took office, he proposed a US$500 billion infrastructure investment plan to renovate cities and rebuild highways, bridges, tunnels, airports, schools and hospitals. Regardless of the U.S. system, policies, laws and social environment, this information undoubtedly brings good news to the world's infrastructure industry and to enterprises engaged in infrastructure construction, and will effectively attract foreign companies in the sector to go there. But why is Trump so keen on infrastructure? In my interpretation, there are roughly several reasons:

　　First, it is a need of Trump's election campaign; infrastructure construction is an important part of his economic stimulus plan. From the initial campaign to his victory speech, Trump repeatedly expressed his emphasis on U.S. economic growth. He believes that through reform, the U.S. economy can maintain an average annual growth rate of at least 3.5%, or even 4%, over the next 10 years, and that his economic plan can create 25 million new jobs for the United States over the next decade. Trump's economic policy mainly includes tax cuts, renegotiation of trade agreements, reducing the openness of immigration policy, and relaxing regulatory controls on enterprises, among which infrastructure investment is an important part of his economic plan. One of Trump's main levers for stimulating the economy is a massive infrastructure push. He said he would invest US$500 billion in large-scale infrastructure, which suits many people's tastes and was also a driving force behind his election victory.

　　Second, Trump comes from an infrastructure background, and a massive infrastructure push is his familiar strength. Trump was once one of the most famous real estate developers in the United States, known as the "King of Real Estate." Relying on real estate and the stock market, Trump owns real estate in prime locations in New York, New Jersey, Florida and elsewhere. He also founded "Trump Shuttle" and was the owner of the New Jersey "Generals" professional football team. Trump has built several luxury towers and villas in scenic towns, and has also purchased a US$100 million luxury yacht and owns a private jet. As an absolutely successful businessman, Trump is very keen on politics and has distinct conservative political ideas. For this real estate tycoon, a massive infrastructure push is his old trade, with which he has a professional emotional bond—one could say he has a particular fondness for it. He knows well that focusing on this after entering politics is a good strategy for development, because infrastructure construction is the prerequisite and foundation of a country's development; without infrastructure leading the way, development will be severely constrained. Trump's revival of America starts with infrastructure.

　　Third, judging from the actual national conditions of the United States, infrastructure construction has also reached a point where it needs to be further strengthened. The golden age of U.S. infrastructure was in the early post-World War II period, when it was the most advanced in the world. But later the United States invested very few resources in repairing, updating and replacing national infrastructure. Today, although local and national agencies have been working hard to form public-private partnerships and operate frugally, U.S. infrastructure still faces unfortunate funding shortages and serious deterioration. The American Society of Civil Engineers has analyzed the country's underinvestment in this area in detail in a series of reports. By 2020, the investment shortfall is expected to reach US$1.1 trillion, and by 2040 it will increase to US$4.7 trillion. It is precisely this situation that led the old hand Trump to invest US$500 billion in a massive infrastructure push as soon as he took office. U.S. infrastructure construction supports economic growth; it is the lines and networks that connect the entire country. To compete in the global economy and improve the quality and standard of living, the United States must rebuild and renew its aging public facilities.

    　Fourth, in order to fulfill campaign promises, Trump must push a massive infrastructure program after taking office. One of Trump's main levers for stimulating the economy is a massive infrastructure push. He advocates increasing infrastructure investment to revive manufacturing, saying that infrastructure should use goods made in America. In his speech after winning the election, he assured Americans: "We will renovate our cities, rebuild our highways, bridges, tunnels, airports, schools and hospitals. We will rebuild our infrastructure, which will be second to none in the future. We will put millions of our people to work on this effort." He also said that from today on, America's governing philosophy will be brand new; empty talk is over, the time for action has come; politicians who only talk and do not act will not be accepted; from today on, America first in all things, and all trade and diplomatic decisions must benefit the United States; two simple principles are buy American and hire American; he promised to build new highways, airports and tunnels across the country. To demonstrate his effectiveness and credibility, Trump must push a massive infrastructure program.

    　It is thus clear that Trump's strong focus on infrastructure after taking office is a settled matter. Infrastructure construction is precisely a major strength of Chinese enterprises. Contracting for overseas projects is the main way for Chinese enterprises to carry out outbound investment cooperation. Data from the Ministry of Commerce show that from January to September this year, China signed more than 500 overseas contracted projects each worth more than US$50 million, more than 30 more than in the same period last year, with a cumulative contract value of US$124.74 billion. The signal sent by Trump now is expected to attract many Chinese enterprises to go global and actively go to the United States to share in the big pie of Trump's massive infrastructure push.