abrdn Global Infrastructure Income Fund (ASGI), featuring Portfolio Manager Josh Duitz

In this episode, Josh Duitz, Aberdeen's Head of Global Infrastructure and a Portfolio Manager for ASGI joins Mike Taggart to discuss the underlying dynamics that are currently driving infrastructure globally. 

Transcript

Transcript

ASGI Podcast, December 2025

Mike Taggart: Welcome to the latest podcast for the Aberdeen Global Infrastructure Income Fund, ticker symbol ASGI. I'm Mike Taggart, Aberdeen's Head of Closed-end Fund Investor Relations. With me is Josh Duitz, the Head of Listed Infrastructure at Aberdeen and Portfolio Manager for ASGI. Josh, thanks for taking the time to discuss ASGI.

Josh Duitz: Thanks for having me, Mike.

Mike Taggart: Josh, the need for infrastructure investment globally is so large, it's kind of hard to comprehend. I was reading that one consultant estimates that $100 trillion is needed through 2040, that's over the next 14 or 15 years, just to keep pace with urbanization, supply changes, and AI-driven technology. Can you discuss the underlying dynamics that are driving infrastructure globally?

Josh Duitz: Mike, wow, that's a great question to start, and we could probably do an hour podcast on that alone, but I will try to be somewhat more succinct and talk about it a little more briefly. So, I think you're referring to a McKinsey report that I read, and it is amazing how much we need to spend on infrastructure. So, let's just talk about a few different categories. We're not going to talk about it all, because as I said, that might take too long.

So, let's just start with, you know, kind of traditional infrastructure. When we talk about transportation, roads, water systems. When we look at those parts of the infrastructure, they were built in the U.S. in the mid-20th century. And we need to rebuild those and repair that part of the infrastructure universe. If we don't do that, it could cost our U.S. economy about $10 trillion by 2040. I think that's what the report was referring to, and I've seen others, I think the American Society of Civil Engineers refers to that as well. 

And when we look at, again, traditional infrastructure, the roads, rails, or its utilities and such. And what's happening with urbanization of population growth, the world's population has doubled over the last 50 years. The number of people living in cities have tripled. That's supposed to increase another 22% of the world's population by 2050. The number of people living in cities is supposed to increase by 50%, where we'll have the world's population, 70% of it, living in cities.

The vast majority, if not all of that population growth, is happening in emerging and developed markets. So, they're really building their infrastructure for the first time, and that's a need for spending. And that's more traditional infrastructure.

You also mentioned AI-driven technology. And I think that's really important right now to talk about. If you look at any wave of innovation, what underpins it, and that's infrastructure. And that's certainly no different in this wave of AI-driven expansion. And the bottleneck for AI in data centers is really the power needed. And we should talk about the US and Europe separately.

Let's start with the US. The US power demand has grown about a half a percent, so less than 1% over the last 20 years. Now that's changing because of AI and data centers. We need more power. We need GPUs rather than CPUs for artificial intelligence. It uses about three to four times as much energy as a CPU. And now we've seen energy growth in the US this year grow about 3.5 to 4%. That was after a decade of no growth.

In Europe, what's happening is we actually saw energy demand decreased by 10% over the last 15 years. And that's just starting to change. If I could just talk about a. Goldman- 

Mike Taggart: Wait, it decreased by 10%?

Josh Duitz: Yes. Energy demand decreased by 10%. Not only that, in Germany itself, if you go back to their energy demand, how much power they're using, they're using as much power today as they were using in 1990 during reunification of Germany. So it's been constantly decreasing. 

So it's really amazing. And we think that's changing.

Now Goldman's Sachs said they had, they did a survey for data centers' electric demand. In other words, how many data centers were requesting that they connect to the European power grid. In 2025, in January this year, there was about 170 gigawatts that requested to be connected. They just reran that same survey. Now it's up to 280 gigawatts. That's a 65% increase in basically nine months. Incredible. That 280 gigawatts, if that was all connected, that's about 90% of the current power demand in the EU 28 countries. So it's amazing.

Now, a lot of that power request for connections won't be connected. Let's just be conservative and say only 20% of those connections actually happen, that will lead to European power growing 2%. So huge need for this power infrastructure. And that's where we see a lot of opportunity.

Mike Taggart: Right. And to kind of tie this back to individuals, you know, investors, you know, this is the stuff that's, you know, powering their homes, getting them from place to place, right? So it's kind of the things we don't even think about in our daily lives that they're investing in. So, when I initially heard of infrastructure investing years and years ago, I thought of it very narrowly, roads, pipelines, that sort of thing. But as you've mentioned already, the universe is quite vast, all kinds of transport, logistics, energy, and power. Plus ASGI invests around the world. So given the exciting growth prospects in this space in your broad investable universe. How do you narrow that all down when it comes to portfolio construction? 

Josh Duitz: That's a great question. So let's start at the beginning. We’ve actually been, although ASGI has been around for a little over five years, I've been managing infrastructure portfolios for over 17 years now. And when we started, we did it by using a framework of where infrastructure spending was going to take place, both by region and by sector. And then we went to bottom up, right? So we have this nice macro view, but it really has to be bottom up stock picking. So there's four broad areas we invest in, transportation, traditional roads, rails, airports, ports globally. We invest in the energy infrastructure, the midstream. And then we invest in utilities, a lot of regulated utilities and renewables and communication. And those are the tower companies. So that we break it down further to those four segments. 

Within those segments, we have a quant tool that breaks it down even further by sub-sector. So we look at ports globally, and we'll look at roads globally, and we'll look at airports globally, and we'll look at rails globally. So we really break it down further. And then we could really do a bottom up. So we're looking and comparing stocks across the globe. And it's really nice at Aberdeen to actually have boots on the ground, both here in developed markets, such as the US and Europe, as well as emerging markets, such as Brazil and elsewhere. So that's how we do it. We really use a quant tool as well as analysts we have globally.

Mike Taggart: Excellent. And then kind of in addition to this already vast investable universe of publicly traded infrastructure companies, the fund invests in private equity infrastructure as well. Would you please talk a little bit about that?

Josh Duitz: Sure. I think that's what makes ASGI really unique because it allows retail investors to have that opportunity to invest alongside institutional investors in private infrastructure opportunities. If you look at private infrastructure assets under management, they've actually tripled since 2016. They went from $500 billion to $1.5 trillion in 2024.Just amazing how much more money's being invested. And this, again, gives retail investors the opportunity to invest alongside institutional investors in the private infrastructure market. And the reason it's grown so much is because there's so many opportunities and opportunities to earn good returns and we hope we can participate in that. Our portfolio is allowed up to 25% in private investments, and we're pretty close to that at this juncture.

Mike Taggart: Okay, thanks. And then finally, a two-part question here. First, in which segments or geographies have you been facing the strongest headwinds, and do you expect that to change going into 2026? And then second, where are you finding the most attractive opportunities, and do you expect that to change?

Josh Duitz: So let's start with some headwinds. 2025 has been an extremely strong year, both for the infrastructure universe and our funds. So we're very pleased about that. I would say we're not macro investors, but there are certain areas that certainly have trailed. And I would say one of those is in the rails globally that we've invested in. And we've seen that change a little bit now, such as in October, we saw domestic rail volumes, very strong in October. And in fact, their share, taking intermodal volume, has actually been the highest ever. So we're seeing that.

Mike Taggart: Intermodal, I'm sorry, intermodal meaning like between trucks and rail, what?

Josh Duitz:  Intermodal transporter within the US, those large containers, and you could either go by truck or rail, and sometimes it's both. So we've seen a higher volume in October for the rails. So that's one, the stocks haven't done very well this year, but we think that could inflect as well as some rails globally that I think some investors misconstrue them as possibly commodity plays rather than the underlying infrastructure and the necessity of them. So I think that could inflect a little bit the rails next year and improve. And as we've talked about, there's a lot of tailwinds. I would say, infrastructure really is one of the most exciting long-term investment opportunities because of the number of structural shifts that are reshaping the global economy. And we've talked about it through artificial intelligence. We haven't really even mentioned the energy transition. And several years ago, when we talked about the energy transition, such as renewables, they were really only being, We were having wind and solar to replace carbon emitted alternatives. Now that's just part of the solution. And we need more wind and solar. We also still need coal and natural gas plants. So we think that this is all part of the solution. So we think there are still a lot of tailwinds and certainly the AI, which is in the very early stages of this power growth and the need for more power. So we think that, like I said, a lot of tailwinds going forward for infrastructure.

Mike Taggart: All right. Well, thank you, Josh, for taking the time to give us that exciting update on ASGI. You shared a lot of great information.

Josh Duitz:  Great. Thanks for having me, Mike.

Mike Taggart:  There are three convenient ways to learn more about ASGI. Visit its website, ABRDNASGI.com. Second, you can e-mail us at investor.relations@aberdeenplc.com. or give us a call at 1-800-522-5465.

I'm Mike Taggart of Aberdeen. Thank you for listening.

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