Infrastructure: Bigger Deals, Higher Stakes

Infrastructure investment hit $1.3 trillion in the first half of 2026, up 18% year on year. The sector's strategic role, from climate adaptation and surging demand for digital and energy infrastructure to security and sovereignty amid geopolitical tensions, continues to underpin its resilience.

Yet infrastructure is not immune to market pressures. Higher interest rates, inflation and volatile oil and gas prices are weighing on financing conditions. The strain is most visible in data centers, where the need to finance an estimated $1 trillion a year over the next decade is compounded by community opposition, power constraints and mounting concerns over returns. Corporate bonds issued by hyperscalers, and even by data-center companies, are repricing, with secondary-market spreads widening to levels rarely seen.

Opening Natixis CIB's 15th Infraday, Fabrice Croppi, Global Head of Investment Banking and Real Assets, and Antoine Saint Olive, Global Head of Infrastructure, underscored both the market's resilience and its changing profile.

Deal activity is a case in point. Transactions are getting ever larger, propelled by an unprecedented wave of AI-driven capital expenditure, while the number of deals fell 10% year on year in the first half of 2026. "Ten years ago, a large deal was worth $500 million," Saint Olive noted. "Today, deals can reach $30 billion, $40 billion or even $50 billion."

The market is also becoming more concentrated. The Americas now account for more than half of global activity, with a heavy concentration in digital and power. "We may now even think of digital and power as a single sector, since much of the new power generation is intended to supply data centers," Saint Olive observed.

Financing is evolving alongside the market, with issuers making greater use of capital markets. Activity rose 26% in the first half of 2026, with $500 billion of bond issuance, the largest half-year total on record. High-yield bonds and term loan B are opening up additional pockets of liquidity. Project finance remains an important part of the mix, but corporate and infrastructure-like transactions are gaining ground, while public-private partnerships have become marginal.

For Croppi, ever more sophisticated transactions reflect an ecosystem that is expanding well beyond its traditional boundaries and now brings together a wider range of players, from equity investors and developers to debt providers and equipment suppliers. To serve clients in this landscape, Natixis CIB combines investment banking and real-asset financing expertise in a one-stop shop, with a product-agnostic approach suited to hybrid transactions.

Beyond traditional project finance, the bank supports acquisitions, an increasingly important feature of the infrastructure world, with strategic advisory, bridge financing and a broad range of funding solutions. It also co-invests in debt through its merchant-banking platform. "We remain fully committed to infrastructure, not only through project finance, but also by addressing hybrid situations and the specific needs arising from the sector's growing corporatization," Croppi concluded.

The first panel, moderated by Nasir Khan, Head of Real Assets Americas, had the honour of welcoming Lieutenant General (Ret.) Michel Yakovleff, alongside Jean-François Robin, Global Head of Research, to examine the key macroeconomic issues of the day against a backdrop of geopolitical tension.

The discussion opened with the Democrats’ “blue wave” in the midterms, which gave them 50 additional seats in the 435-member House. General Yakovleff called the result “a great success for democracy”, while questioning “how much democracy is left in America”. He argued that America’s archaic political system had reached its limits under President Trump over the past two years, calling it “a complete failure of the system”.

Indeed, both agreed the result was unlikely to change Trump’s approach significantly: the Democrats would fall short of the two-thirds majority needed to override a presidential veto, and Trump governs by executive order.

Nonetheless, the “blue tsunami”, as Robin called it, which reached even Texas, Kansas and Georgia, amounted to a referendum on Trump, reflecting voters’ concerns about affordability and their opposition to the war. “Republicans will clearly have to come around to these concerns,” he added, resulting in “a dynamic of bipartisan agreement”.

The proposed expansion of data centers is likely to come under particular scrutiny. Under one of the 42 resolutions, it would reportedly involve $10 trillion of spending over the next six years, equivalent to 3.6% of GDP. That could be a concern, as data-center spending is a massive engine of US growth and, indirectly, of consumption, since 66% of the population has equity exposure.

On the conflict with Iran, the Democrats’ strong showing could mark the beginning of the end of the war. “America wants out.” Trump had been poised to continue or even escalate, but now faces pushback, as the Democrats will most likely cut off funding. “Whether you rule by decree or not, ultimately you still need to come back to us to fire missiles,” Yakovleff said, predicting that the United States would seek a negotiated and unfavourable peace with Iran.

“My suspicion is that Trump will use the Democratic Congress as an excuse for his own failure,” Yakovleff wagered. In all likelihood, Trump will blame the Democrats for signing off on a bad deal, claiming he was on the verge of winning the war. “He’s going to use the Democrats to find a way out of his Iran quandary.”

Turning to the protracted war between Russia and Ukraine, Yakovleff, drawing on the philosopher Mikhail Epstein, argued that Putin has set Russia on a nihilistic path, with no war aim other than waging war. “War, justified by a spurious NATO threat, serves to legitimise his regime and ultimately has not much to do with Ukraine.”

With neither side able to prevail on the battlefield, at least on current trends, the only way the war will end, he said, is through the collapse of Putin’s regime. It will happen “whether next month, next year or in ten”, he added, warning that “such a brutal change of regime would most likely lead to civil war”.

Turning to the economic fallout, Robin noted that the global economy has proved remarkably resilient to higher energy prices and inflation. “Crises come one on top of the other, and still, the world economy is coping quite well.”

Natixis CIB’s central scenario envisages a return to oversupplied oil and gas markets, though probably not as soon as next year, as restocking will keep demand firm. Prices should eventually settle well below current levels, restoring purchasing power and easing financial conditions. “Central banks will probably raise rates once, perhaps twice, no more.”

The picture is less rosy for the average American, the proverbial “Joe Six-Pack”, Robin lamented. The widening wealth gap is stark: the poorest 80% of Americans now account for only 30% of consumption. Between 2020 and 2025, the richest 1% captured 41% of the wealth created, against just 1% for the poorest half. The trend is global: the world’s roughly 3,000 billionaires held 4% of global wealth in 1987, compared with 17% today.

Robin offered a counterpoint, however, highlighting the sharp fall in global poverty. “In the early 1990s, nearly 25% of the world’s population lived on less than $1.90 a day. Today, it’s 8%. That’s a remarkable achievement of globalisation.”

That said, both panellists agreed that globalisation as we knew it is coming to an end, and that the trend is accelerating. Countries are teaming up with partners, not necessarily their geographical neighbours. “We’re now talking about Canada as a European country,” Robin quipped, while the UK is drawing closer to the EU again. After all, “it’s not working to go it alone in a world shaped by Xi Jinping, Vladimir Putin and Donald Trump”.

For Yakovleff, this shift reflects the breakdown of the principle of “equality of nations before the law”, established by the United States after the Second World War but increasingly challenged by Washington since the end of the post-Soviet unipolar era. The US, he analyses, has come to view this principle as a constraint.

“The trade war and legal warfare against Europe began in the 2000s. America invented the extraterritorial reach of its laws, which runs counter to the principle of equality before the law.”. “The only solution is for like-minded countries, as Mark Carney put it, to reach agreement among ourselves. I’m cautiously optimistic about that.”, he concluded.

The panel turned to China and its place in this increasingly fragmented world. Is decoupling between the US and China possible? Can Europe preserve its competitiveness and strategic autonomy?

Yakovleff argued that, under the concept of Tian Xia (“all under heaven”), China sees itself as the centre of the universe, with tributary states such as Russia paying tribute in return for protection and recognition, while countries such as the US are viewed as “barbarians” who reject this supposed natural order.

Taiwan embodies this hegemonic ambition, standing as an anti-model. “Taiwan demonstrates that you can be Chinese in culture and yet a true vibrant democracy and rule of law,” Yakovleff argued, adding that he sees “a window of opportunity to subjugate Taiwan now”. Xi Jinping, he explained, needs to spend his political capital before it erodes over the next five to ten years amid mounting social and environmental strains. He reported that a number of generals have assured Xi of victory, but not of a short war, which could deter him from getting bogged down. “That’s their best chance today in Taiwan.”

Complementing with a more economic angle, Robin added that China is pursuing vertical integration so that other countries depend on it, while it depends on no one. Its massive drive to electrify, both to secure its energy independence and to dominate global supply chains, is a case in point.

For him, there is no doubt: “China is decoupling and no longer relies on the US economy”. It is selling off its US Treasuries, buying gold, developing alternative payment systems and deepening trade ties across Asia.

Yet Robin also pointed to a vulnerability: China’s ageing population and limited domestic market leave it heavily dependent on exports, particularly to Europe. “We forecast Chinese economic growth of 4.5% to 4.6% this year, 4% next year. But going into the next decade, China will probably be growing at around 2%, because this is a super-ageing economy.”

He also sees a growing push in Europe to fight back by waging a trade war against China, which will obviously hit Chinese exports.

Jean-François Robin underscored that the European economy has shown resilience, notably as it has been only modestly affected by oil and gas supply disruptions linked to the blockage of the Strait of Hormuz, through which no more than 20% of European imports transit. Germany and France should see growth of 1%, perhaps 1.3% to 1.4%, in 2026, while some countries are doing fantastically well: the Nordics, Poland and Spain (3% growth).

Still, Europe has a massive problem of price competitiveness, Robin argued. Some 70% of its energy mix is still oil, gas and a little coal, few of which it produces, and it pays twelve times more for its gas than the US. Germany may be becoming a growth engine again after six lean years, but the issue of the moment is France's political deadlock ahead of the 2027 presidential elections.

The panel finally turned to the AI revolution and the global economy’s capacity to absorb the transformation it will bring. Drawing on the views of two recent Nobel laureates, Robin noted that even the most optimistic scenario points to a productivity gain of just 0.7 percentage points at the level of organisations, concluding that this is a tricky exercise to forecast.

Asked how AI will change the nature of warfare, general Yakovleff observed that “AI is great at doing targeting, but not at winning wars”. The conflict in Iran bears this out: widespread use of AI has not led to Iran’s defeat. In his view, future conflicts will be longer wars of attrition, ultimately won through manpower.