Identifying and managing risk in international construction projects

Abstract EN

Over the last decade, major construction projects have increasingly arisen in countries or regions that lack specialist, expert construction contractors, suppliers and consultants.

Steps are being taken by governments in the Middle East, Eastern Europe, China, India and developing markets to address national infrastructure deficits, and by so doing, are creating new regions of booming construction demand.

When coupled with anaemic growth in developed markets such as the United Kingdom, the USA and Western Europe, foreign markets present attractive opportunities to the global construction industry.

However, foreign markets are littered with the cautionary tales of international contractors and consultants that have failed to grasp the intricacies and risks of operating in a new environment and have failed to capitalise on the opportunities available.

By identifying the classes of risks, and undertaking detailed analysis, ranking and mitigation of relevant jurisdictional risks, participants in international construction projects will increase the likelihood of project success and commercial longevity in the new jurisdiction.

Risk identification and assessment is not a science but an art, and while there are many potential approaches to the issue, we propose that our strategies for identifying, assessing, ranking and mitigating jurisdictional risks offer new international players a good chance of commercial success.