Schnitger Corporation

Myanmar highlights infrastructure opportunity

Megacity HighwayA fascinating article caught my eye earlier this week; it perfectly sums up all that is wrong with our infrastructure and the significant benefits if only we could summon the will (and cash) to fix it.

The country of Myanmar (formerly known as Burma) has suffered under international sanctions and inept management that have left it with a sadly neglected infrastructure. Where projects have been undertaken, shoddy workmanship and supplies often made the problem worse rather than better. Roads are too bumpy to enable fast transport. Hotels may look like resorts on the outside but are poorly built and so unlikely to attract tourist trade. Electricity and telecom networks are unreliable, leading to travelers feeling “cut off” and not instilling confidence in Myanmar as a place to locate a factory or other business. (You can read the whole article here.)

This isn’t unique to Myanmar. We’ve seen similar stories about companies that must buy expensive generators to augment the iffy electrical infrastructure in parts of India — without reliable, consistent power, they cannot use modern, high-accuracy NC machines. Without those machines, they cannot bid on sophisticated, higher-profit projects. If all they can bid on are commodity jobs, they cannot compete on a global level. The most spectacular electrical disruptions may have been in India last summer, but this news is all too common.

And it’s not only a problem in the developing world. The American Society of Civil Engineers, estimates that 42% of major urban highways are congested, costing over $10 billion in wasted time and fuel each year. The US Federal Highway Administration estimates that $170 billion is needed every year to start making a dent in the problem. (And that’s just roads. We’ll need another $21 billion per year for bridges. To get the power distribution system up to snuff, we’ll need to invest $57 billion by 2020 for our electrical distribution infrastructure and $37 for transmission. Think your drinking water supply isn’t threatened because you live in the US? Hmm. The ASCE says that there are around 240,000 water main breaks per year in the United States, but, on the upside, “[e]ven though pipes and mains are frequently more than 100 years old and in need of replacement, outbreaks of disease attributable to drinking water are rare.” Good to know.)

The depressing reality is that much of our infrastructure is being held together by chewing gum and bobby pins — where it exists at all. Public/private partnerships (the P3s that I wrote about last month) are one way to start addressing the problem, here in the US and in places like Myanmar. Without public will, nothing will change. Without a crisis, it’s unlikely that most individuals will muster up enough energy to force change.

But businesses are different. That same ASCE report says that a 1 hour interruption in the electrical supply costs a household $3.27; a business $1,074 and an industrial facility, $3,943 (I’ve got to think that last number is an average across a very wide range of “industries”). The inconvenience of alarm clocks that don’t wake the family in the morning becomes a major problem for production lines that crash and must be carefully restarted as power comes back up. Odds are that businesses will lead the charge to fix our infrastructures because the cost of poor infrastructure are so much higher for them, they may be forced to pay workers even when in infrastructure hiccup suspends production, and their customers don’t want an interrupted flows of goods.

According to the article that started this train of thought, Myanmar’s natural gas reserves could be used as a guarantee against (private) foreign investment in power generation and transmission grids. A firm would come in to build plants and power lines; revenue from electrical customers could eventually pay off the investment. As a risky business climate, putting up part of the natural gas asset as collateral would help get the deal done.

Technology, the kind we’re passionate about, plays a crucial role here. Stakeholders (investors, local residents, regulators) need to understand the risks and benefits of any project, and the visualization and collaboration technologies inherent in most CAD solutions for the infrastructure market make this more accessible than ever before. Simulations can quickly show alternatives in ways that are easy to understand, even for non-engineers. Analyses can look at dozens or hundreds of alternatives early in the project and winnow out a few for real design exploration; during later stages, they can help determine the most efficient order for construction. The digital asset created during all of this activity can be used downstream to plan maintenance, expansion and other lifecycle activities. If appropriate, it can also be used in the financial payback calculations of a P3 — modeling traffic, for example, to feed into toll revenue and maintenance cost projections.

Back to Myanmar. The writer of the article speaks about taking a 320 kilometre (200 mile) bus ride from Yangon to Naypyidaw. Yangdon used to be known as Rangoon and is the country’s largest city and major commercial center. Naypyidaw is Myanmar’s capital since 2005 and is one of the world’s fastest growing cities. That 200 mile ride might take about 3 1/2 hours if you were going from Boston to New York but takes 6 1/2 hours in Myanmar. Said the writer, “traffic jams are not to blame for the slow pace. On the contrary, traffic is only seen occasionally on the main route between the old and new capitals. Rather, substandard construction techniques are to blame for the slow, sometimes bumpy ride.”

We don’t, of course, know why the construction was substandard. But one thing does stand out: The last time I drove from Boston to New York, tolls were something like $20 for a passenger car and would be much higher for a bus; the distance in Myanmar costs US$10 per coach. There’s no way that the people of Myanmar can invest in their infrastructure if they don’t charge users enough to maintain it*. If there were a BIM model (we really need a better name for this when applied to non-buildings) of the highway, they could have worked out usage, maintenance, expansion and all sorts of other details that might have led to more appropriate design, adequate funding for better materials and construction and a plan for maintenance.

*Yes, the tolls from the MA, CT and NY highways don’t go directly to maintaining those roads. It’s also possible that the government of Myanmar wants to subsidize use of that particular highway. But, in the end, the money for infrastructure has to come from somewhere — and charging tolls is one way to raise funds.

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