industry focus constructive partnerships...analysis industry focus: constructive partnerships 3 5 8...
TRANSCRIPT
Industry focus
Constructivepartnerships
June 2018Middle East Issue #18
Global economy:Positive growth, but IMF asks how long it
can be sustained
Regional economy: Saudi Arabia the
‘torch-bearer’ for Gulf economies as they
diversify from oil
Commodities price analysis
2June 2018 www.curriebrown.com [email protected]
Global economy: Positive growth, but IMF asks how long it can be sustained
Regional economy: Saudi Arabia the ‘torch-bearer’ for Gulf economies as they diversify from oil
Commodities price analysis
Industry focus:Constructivepartnerships
3
5
8
10
Contents
Welcome toInsight #18Global growth reached its highest level for more than six years during the second half of last year, and the International Monetary Fund (IMF) is predicting a further two years of improved conditions.
Its latest forecast is that the 3.7 per cent average growth figure for the second half of 2017 will rise to 3.9 per cent per year during 2018 and 2019. That positive is offset by the Fund’s finding that growth figures vary sharply across economies.
Growth rates in China, Japan, the United States and the eurozone rose beyond IMF expectations during the same period last year. There were also better-than-expected growth figures among those Asia-Pacific economies that export commodities, as well as among similar countries in sub-Saharan Africa and the Middle East.
Although the general trend is upwards, the news is not universally good across global economies. Significant structural changes are underway in specific economic areas such as the Arabian Gulf, where the Gulf Co-operation Council (GCC) countries in particular are on a journey of diversification away from their enormous reliance on hydrocarbons, for example.
And in China, where growth continues to outstrip most other nations but is nevertheless lower than previous levels, a distinct change in strategy is underway as the government seeks to bring in more partners for significant infrastructure investments to the west and south of the country.
We examine the implications of all that for you and your business in the Middle East in this edition of Insight. We also look at significant news and developments as they affect the region.
This edition also includes a special look at P3, the standard for project management across the construction sector worldwide. The Association for Project Management (APM) defines P3 as “projects, programmes and portfolios”, but it might be described more succinctly as whole-life asset management.
P3 works across all types of procurement and project management, with particular relevance to public-private-partnership (PPP) projects, where there is a real incentive for all parties – clients, managers and contractors – to plan thoroughly. Governments and other agencies are turning increasingly to PPP as a form of procurement, especially in the Middle East and Asia.
2March 2018
3June 2018 www.curriebrown.com [email protected]
Economies worldwide are experiencing positive growth, helped by better-than-expected performances in the United States and the eurozone countries, in an upturn that is being matched in most other regions.
The news is good across most major economic regions, with China and Japan leading the way in Asia. In the Middle East, strategic adjustments to public spending on projects continue to have an impact.
Oil prices made a further recovery over recent weeks – at one stage passing the US$80 a barrel level and settling comfortably above US$70. While that is welcome, particularly among many oil-producing economies, there is little sign that any of them are loosening spending
controls or austerity measures introduced since prices collapsed during 2014 and 2015.
The IMF pointed out that as tax changes in the US filter through, there will be a slight slowing-down of growth after 2020. Its forecasters are also concerned that growth will be affected by the ageing populations of the mature economies, with higher costs and potentially lower tax income resulting from such demographic changes.
“While the expected recovery in investment will help raise potential output, weak productivity trends and reduced labour force growth due to population ageing will constrain medium-term prospects in advanced economies,” notes the IMF in its latest forecast.
Global economy:Positive growth, but IMF asks how long it can be sustained
Global economy
The outlook is mixed across emerging market and developing economies.
4June 2018 www.curriebrown.com [email protected]
Global economy
But it included a warning for other regions, many of which are dealing with political and economic uncertainty, or those countries with weak exports. “The outlook is mixed across emerging market and developing economies”, comments the IMF.
“Prospects remain favourable in emerging Asia and Europe, but are challenging in Latin America, the Middle East and sub-Saharan Africa, where – despite some recovery – the medium-term outlook for commodity exporters remains generally subdued, with a need for further economic diversification and adjustment to lower commodity prices.”
The IMF adds: “More than one-quarter of emerging market and developing economies are projected to grow by less than advanced economies in per capita terms over the next five years, and hence will fall further behind in terms of living standards.”
On the upside, the IMF notes that what it calls the “growth spurt in advanced economies” could prove to be stronger and more durable than its baseline analysis might suggest. For example, labour markets may have more slack than is apparent, and investment could recover further to spark a “rebound in productivity, with higher potential growth post-2020”.
On the downside, the IMF analysis is that financial conditions could “tighten considerably” and reveal export vulnerabilities that it says have accumulated over many years. This is especially true in the United States, where fiscal tightening – when combined with that country’s very high current account deficit – could have damaging implications in global terms.
The messages coming from Washington – tax cuts, changing economic policy and import tariffs particularly on commodities like steel – are of concern to other governments and economists as they attempt to
chart a way ahead for the 2020s. The US policy on tariffs has sparked reprisals from the European Union, which has pressed forward with retaliatory duties against US$2.8 billion worth of US-made products. China’s central bank has cut reserves to unlock US$108 billion, which some China analysts say will help ease the impact of a potential trade war with the US.
Further, the continuing uncertainty in parts of the Middle East – with ongoing conflicts in Syria and Yemen and the continuing tension concerning Qatar – is being watched with unease in some quarters.
Global growthSource: worldbank.org
Global trade and investment growth, volumesSource: worldbank.org
The IMF notes that what it calls the “growth spurt in advanced economies” could prove to be stronger and more durable than its baseline analysis might suggest.
5June 2018 www.curriebrown.com [email protected]
As the Middle East grapples with issues of conflict, oil prices and changes in economic strategy, there are signs of a clearer path emerging for the Gulf states.
Oil prices have risen since the start of this year, to comfortably above the minimum most OPEC economies need if they are to prosper. But the lessons learnt from the last three or four years are embedded into state policy, particularly in the Kingdom of Saudi Arabia but also in other states.
Serious structural change has been initiated in many areas, most notably in the way that governments assess the true value of major construction projects and then procure them. The growth of acceptance of public-private-partnerships (PPPs) is one example. But there remains a long way to go towards achieving the aim of a greater economic mix.
Governments such as Saudi Arabia have taken steps to reduce their reliance on foreign workers in favour of indigenous ones, but that policy requires careful handling if it is to retain highly skilled people who hail from abroad.
In June, Abu Dhabi announced a $13.6 billion stimulus programme, aimed at boosting the construction market and getting various projects moving over the next three years, following a period of relative stagnation. The additional money will come mainly from additional oil revenues.
Most Gulf Co-operation Council (GCC) states are also weaning their economies away from oil and towards
renewable energies – chief among them solar and wind power – for domestic power. This is not to say that oil and gas are being deserted, but the producers are keen to maximise the export potential of hydrocarbons while at the same time choosing ‘greener’ solutions at home, partly because they may be cheaper in the long run.
Changing attitudes are exemplified by the Dubai entrepreneur Mohamed Alabbar, founder of Emaar Properties. In a recent Arab News interview he commented: “The true capital of our city is not oil wealth. The future is to build a sustainable, fully diversified economy. Oil does play a part today and tomorrow, but we must use this resource to build a self-sustaining and bright future for our youth. As leaders in government and business, we owe it to our society to make the vision of our wise leadership come to fruition.”
Saudi Arabia the ‘torch-bearer’ for Gulf economies as they diversify from oil
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OPEC monthly basket price (US$)
Mohamed Alabbar, founder of Emaar PropertiesSource: linkedin.com Source: opec.org
6June 2018 www.curriebrown.com [email protected]
Regional economy
Dubai has been used by Crown Prince Mohammed bin Salman – the reformer leading Saudi Arabia’s ‘Vision 2030’ programme – as an exemplar for the Kingdom as he strives to change local thinking. The question on the lips of many observers is how far that revolution in approach may go. “Saudi Arabia is the largest economy in the region, and a G20 member, and the Kingdom is a torch-bearer for our region to be seen as a positive force and a global citizen,” remarked Mr Alabbar.
The research agency MEED says that “all eyes” are on the Kingdom’s projects market, as it seeks to improve on a challenging couple of years. MEED said that the Saudi Arabian market had fallen by more than 50 per cent to $25 billion in both 2016 and 2017, accounting for around half of the reduction in total contract awards across the GCC during that period.
MEED concluded that there was “cautious optimism” that the reforms introduced in Saudi Arabia – from an anti-corruption drive to major social changes such as allowing women to drive – will give way to increased spending on projects over the coming months. The biggest deals due during
2018 are the £1.5 billion expansion of the Jeddah South power plant, and three stages of the King Salman International Complex for Maritime Industries and Services.
This new way of thinking is shared across the GCC. Another MEED analysis – covering the UAE, Bahrain, Kuwait and Oman – points out that for contractors, being “only a builder” is no longer enough to ensure survival in an increasingly competitive market. Construction companies that can bring money to a deal – either their own money or in the form of third-party investors – will have the edge, found MEED, as clients attempt to find new ways to fund projects.
Another area that merits close scrutiny is rail. Before the oil price slump, significant urban rail developments were in train for Makkah, Jeddah, Medina and Dammam in Saudi Arabia, as well as others in Abu Dhabi, Bahrain and Kuwait City. Long-distance connections were planned for all six states, but budget cuts since 2014 have delayed many projects. In 2016, the prestigious Etihad Rail project was awarded to contractors, only to be cancelled.
However, the dust may be clearing for Etihad Rail. With the 264km first stage operational for three years, bids are being tabled for a renewed attempt at the next stage. The UAE has indicated a readiness to seek private sector funding to ensure the go-ahead this time.
In a reflection of new thinking, the UAE has decided to allow 100 per cent ownership of companies for the first time, and also to give ten-year visas to highly qualified professionals including investors, scientists, doctors, engineers and entrepreneurs. Prime Minister Sheikh Mohammed bin Rashid Al Maktoum commented: “Our open environment, tolerant values, infrastructure and flexible legislation are the best plan to attract global investment and exceptional talents.”
Large-scale projects continue to be developed. Dubai Electricity and Water Authority (DEWA) has earmarked $22 billion in project commitments over the next five years. Nearly half of that figure will go to production, with the rest on transmission and distribution and water infrastructure projects. DEWA will tender a 300MW solar power project in early 2019.
Saudi Arabia has signed a $200 billion agreement with Japanese investment house SoftBank for a range of solar projects across the Kingdom, developing 200GW of power.
Saudi Arabia has signed a $200 billion agreement with Japanese investment house SoftBank for a range of solar projects across the Kingdom, developing 200GW of power.
7June 2018 www.curriebrown.com [email protected]
Expo 2020Source: expo2020dubai.com
The first project in Saudi Arabia’s nuclear power programme has moved a step closer too. MEED reported that authorities have approved proposals and will now talk to potential developers of two power stations. Short-listed sites for the development are at Umm Huwayd and Khor Duweihin, both on the coast near the UAE and Qatar borders.
Still on renewable power, the first solar-powered factory to produce dates is to be built in Dubai. Abu Dhabi company Enviromena will help build the plant for Al Barakah, the largest privately-owned date producer in the region. Al Barakah processes more than 60,000 tonnes of dates into various products each year, exporting to 54 countries.
Dubai's Roads and Transport Authority has awarded contracts for two phases of the Expo 2020 roads project, worth a total of $354 million. The work includes various improvements to intersections and flyovers on major roads connecting Dubai to the Expo site.
Oman is establishing an investment fund with the aim of attracting more foreign money into the state’s infrastructure projects. Construction Week reported that Omani authorities may also seek new foreign investment
in the technology sector, principally in healthcare and medical equipment.
Kuwaiti officials have published a guide on PPP that is aimed at encouraging take-up of recent changes in the law to enable private investment in public projects. Although Kuwait has been working on the encouragement of PPP for some time, only one major project has been completed since 2008. A major water and power project was cancelled last year.
The Kuwaiti oil giant KNPC is to build two oil refineries producing more than 500,000 barrels a day. The decision is in support of a government target to produce two billion barrels a day by 2035. KNPC is also breaking ground on a new refinery plant in Oman, and opening another refinery in Vietnam.
Container port and airport capacity continues to increase across the region. Kuwait is considering a ‘mega airport’ that might attract $12 billion investment and create 1,000 jobs, according to the president of Civil Aviation Sheikh Salman Sabah Al-Humoud Al-Sabah. The 25 million passenger airport would be built to meet demand, although similar estimates of growth in both tourism and business traffic are being used to support aviation expansion across the GCC.
Abu Dhabi has set out ambitious plans to expand Khalifa Port, unveiling a five-stage plan that will quadruple current capacity. Completion would result in a new capacity of ten million twenty-foot equivalent units (TEUs) – about half that of the giant Jebel Ali port in Dubai. Abu Dhabi believes its semi-automated port will be much more efficient for container ship operators and their clients.
Regional economy
In Dubai, the Roads and Transport Authority has awarded contracts for two phases of the Expo 2020 roads project, worth a total of $354 million.
8June 2018 www.curriebrown.com [email protected]
Price analysis
Commodities Unit Q3-2017 Q4-2017 Q1-2018 Q2-2018
Non-ferrous metals
Aluminium alloy US$/tonne 1,716.66 1,835.49 1,836.38 1,893.97
Aluminium US$/tonne 2,070.05 2,162.11 2,208.69 2,245.04
Copper US$/tonne 6,428.23 6,883.03 7,063.11 6,944.86
Lead US$/tonne 2,360.17 2,494.76 2,488.71 2,352.41
Nickel US$/tonne 10,823.87 11,862.42 13,595.53 14,382.04
Tin US$/tonne 20,332.32 19,614.97 21,017.64 20,898.25
Zinc US$/tonne 2,837.79 3,033.10 3,136.08 3,012.71
Steel
Reinforcing bars US$/tonne 503.33 533.33 581.67 597.50
Steel beams - channel US$/tonne 638.33 656.67 698.33 687.50
Hot rolled plates US$/tonne 563.33 603.33 635.00 637.50
Cold rolled coils US$/tonne 596.67 646.67 658.33 662.50
Prepainted galvanised steel, 0.35 US$/tonne 860.00 895.00 898.33 900.00
Stainless steel HR coils 304 base US$/tonne 2,175.00 2,166.67 2,233.33 2,275.00
Energy
Crude oil US$/barrel 49.91 59.43 64.70 71.21
Diesel (Dubai only) AED/gallon 7.22 8.09 9.15 9.39
Cement
Cement US$/bag 3.74 3.69 3.84 3.87
Cement (Dubai suppliers) AED/bag 13.84 13.67 14.22 14.33
Rubber
Rubber US$/100kg 212.86 201.31 199.51 188.42
Bitumen 60/70
Bitumen US$/tonne 493.24 493.24 493.24 493.24
■ All prices for commodities are based on bulk quantities, cash trade, US dollar.
■ Non-ferrous metal prices are derived from London Metal Exchange, whereas steel prices are derived from Middle East steel price indications; all based on average prices for the month.
■ Reinforcing bars are based on the average price from four UAE suppliers.
■ The rate for steel beams - channel has been derived from Far East/Europe/India market.
■ Crude oil price is derived from light crude Brent, US market.
■ Diesel rates are from EPPCO.
■ The price of rubber is derived from International Rubber Board, based on average prices for the month.
■ Cement prices are derived from UAE local supplier.
Commodities
9June 2018 www.curriebrown.com [email protected]
CommoditiesAE
D/g
allo
nU
S$/to
nne
US$
/bar
rel
US$
/tonn
eU
S$/to
nne
US$
/bag
Crude oil (2009 - 2018) Cement (2009 - 2018)
Diesel (Dubai only) (2009 - 2018) Steel (2009 - 2018)
Low non-ferrous metals (2009 - 2018) Non-ferrous metals (2009 - 2018)
15.00
30.00
45.00
60.00
75.00
90.00
105.00
120.00
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
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Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
5.00
10.00
15.00
20.00
25.00
30.00
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
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Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
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Q4
Q1
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Q1
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Q3
Q4
Q1
Q2
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Q4
Q1
Q2
Q3
Q4
Q1
Q2
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
2.00
4.00
6.00
8.00
10.00
12.00
14.00
16.00
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
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Q1
Q2
Q3
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Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
1,000.00
2,000.00
3,000.00
4,000.00
5,000.00
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
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Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Steel beams - channel
Hot Rolled Plates
Cold Rolled Coils
Reinforcing bars
Prepainted Galvanised Steel, 0.35
Stainless Steel HR Coils 304 Base
5,000.00
10,000.00
15,000.00
20,000.00
25,000.00
30,000.00
35,000.00
40,000.00
45,000.00
50,000.00 Copper Nickel Tin
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
500.00
1,000.00
1,500.00
2,000.00
2,500.00
3,000.00
3,500.00
4,000.00
4,500.00 Lead
Aluminium Alloy
Aluminium
Zinc
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
Q3
Q4
Q1
Q2
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
10June 2018 www.curriebrown.com [email protected]
Focus
Achieving the delivery of construction projects that are the right outcome, smart, timely and meet the operating and investment objectives, requires the industry to continually innovate. This becomes further amplified in our world where client expectations are higher than ever, and budgets and procurement methods are under ever-increasing scrutiny.
There is no shortage of complexity. The industry has to respond imaginatively and convincingly to the challenges. Designs are increasingly ambitious, and often involve new materials and methods. The ‘future-proofing’ of the asset, through flexible design capable of incorporating intelligent design and altered working patterns, is important too. For mega-projects the complexities are compounded with multiple concurrent planning and investment decisions to be made in real time.
Incremental and important steps are taking place to enable the safeguarding of projects within a risk-
managed environment. The growing appreciation of the importance of collaborative working, with greater access to better quality information via increasingly sophisticated information technology that such technologies demand, is becoming key to achieving a fully integrated outcome. This is a new reality within developed markets, with BIM-led design and construction, and a queue of almost-ripe robotised construction systems ready to mobilise.
The gap between maximising the benefits afforded by technical innovation and the protection of commercial interests can be achieved through collaborative partnerships.
Increasingly, the industry is adopting so-called ‘P3 management’ (public-private partnerships) to achieve strategic success for built asset portfolios. Key to this is the need to take a wider, integrated approach to project identification, funding and procurement. As ever, both early involvement and building on new and established stakeholder relationships is vital.
Constructivepartnerships
The Middle Eastern market – led by the Gulf region – has been slow to adopt whole-of-life (capex and opex) decision making.
11June 2018 www.curriebrown.com [email protected]
Focus
Projects are also now being fundamentally evaluated against the optimisation of the completed asset across its operational lifespan: global consciousness demands longer-term thinking, with exposure to real fundamental issues, such as climate change, now impacting key decision-making. Project managers, cost managers and designers must account for and collaborate with end-users to place the project brief in the widest context. Accurate lifecycle cost modelling right at the project-initiation stage, with benchmarks taken against known costs, is essential to the development of the industry in newer markets, where public transparency, openness and accountability are increasingly demanded. The question is how quickly and effectively the industry can adapt to all this.
So what is P3 and how does it help? The Association for Project Management (APM) makes the point that “although projects, programmes and portfolios are often spoken of as being mutually exclusive, they are
actually combinations of managerial tools and techniques describing different circumstances.” Simply, the best-managed projects result from adopting an integrated approach to all three aspects.
Truly effective P3 demands that the industry helps its clients at the strategic planning stage, rather than waiting to be brought in almost immediately before contracts are tendered. That requires heightened awareness on the part of the clients – public and private – and a willingness to draw the industry closer into their thinking at the earliest stage.
There are differing motivators and interests in adopting P3-type structures across geographies and markets. A long history of examples abound in the mature construction markets of North America, Western Europe and Australia. The emerging construction markets of the Middle East and Asia have made exploratory moves and have had some successes with P3, although challenges remain.
In the Middle East, there are many current examples of high-profile projects that need such an integrated approach to succeed. They include the development of Lusail City in Qatar, the ‘financial cities’ of Jeddah and Riyadh in the Kingdom of Saudi Arabia, and region-wide developments such as university campuses, ‘hub-and-spoke’ health infrastructure, metro systems and power distribution networks incorporating nuclear, renewable and traditional, fossil fuel energy sources.
‘Joined up’ governance and strategic expertise are in demand for significant and ambitious regional plans such as the NEOM mega city project, also in Saudi Arabia.
Construction markets in the Middle East and large parts of the Asia-Pacific region are among the most vibrant in the world. They are home to some of the highest-profile and ambitious building projects, attracting interest from the global industry.
Truly effective P3 demands the industry helps its clients at the strategic planning stage.
Lusail City, QatarSource: lusail.com
12June 2018 www.curriebrown.com [email protected]
Focus
Traditionally, such projects tended to focus on their capital expenditure, or capex. Public and private sector organisations measured progress by their capital expenditure. High-cost projects were usually funded directly by government that had no tradition of seeking private sector partners or investors to spread the risk. Funding came straight from public coffers, or public borrowing, often on a cost-plus basis, and little attention was paid to the operational cost (opex) side of the equation.
The Middle Eastern market – led by the Gulf region – has been slow to adopt whole-of-life (capex and opex) decision making. But the sands are shifting as governments and other major organisations change their attitudes towards project funding. Increasingly, they are embracing P3-style procurement, where the private sector is responsible for operating the asset, and hence drives decision making in the development phase to protect the asset returns that are critical to the investment decision in the first place. That requires trust and openness in terms of planning at the strategic stage, founded on the fundamental principle that P3s are first and foremost partnerships and must respect the drivers of all the parties.
With a new generation of indigenous professionals moving up into decision-making positions, they demand that their future projects achieve or improve upon the operational efficiencies of comparable, world-class capital-heavy projects elsewhere, with transport infrastructure, healthcare and education being current major initiatives in play.
In the Asia-Pacific region, mega-projects, largely in transport infrastructure, housing and manufacturing, are becoming more numerous. The Belt and Road Initiative (BRI), China’s grand scheme to involve dozens of countries in a re-activation and expansion of the ‘Silk Road’ between the East and Europe, will involve large-scale funding and hundreds of development projects from the South China Sea to the Mediterranean and beyond.
In East Asia, massive endeavours such as the 55 kilometre-long Hong Kong–Zhuhai–Macau bridge and tunnel project, connecting three major cities, continue to test both cost limitations and project management systems. The significant doubt over the project’s original completion date being met has proven justified, amid engineering problems and cost over-runs. Complexity is often the issue.
The Nikkei Asian Review reported that exports of high-speed railway systems from China to neighbouring partners – a key element of the Belt and Road Initiative – are lagging behind schedule because of challenges in the recipient markets, where land acquisition and project funding by the joint parties remain problematic.
One such rail project in Thailand has been two years in the gestation, although the ultimate aim of connecting the line to a pan-Asian rail network, as envisaged originally by China, remains elusive. For massive strategic ambitions to be realised, a real understanding of and commitment to advanced project planning is required. As can be appreciated, this is significantly more challenging when international politics are involved.
The message here is that collaborative partnerships adopting a P3 management approach will ultimately be more successful. This approach will provide greater surety in the way projects are funded and delivered, bringing significant benefits in terms of reducing waste, achieving capital and operational cost efficiencies and bringing projects to fruition in the most efficient and sustainable manner. As the size, cost and complexity of mega-projects continue to grow, the need to adopt such strategies will become even more vital.
NEOM mega city project, Saudi ArabiaSource: themaghrebtimes.com
P3s are first and foremost partnerships and must respect the drivers of all the parties.
13June 2018 www.curriebrown.com [email protected]
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