projects are going to save the economy—
at least that’s what everyone keeps
saying. Government officials and private investors around the world are
pouring dollars, pesos, yen and euros
into massive, long-term, high-cost
projects designed to simultaneously
jumpstart the tanking economy and
prop up aging systems in developed
nations, or build whole new modern
structures and technology in developing
Whether it’s building basic telecom
infrastructure in Africa, constructing
new roads in India or replacing dilapidated bridges in the United States,
there is no question the projects are
needed. And the potential is huge.
The Organisation For Economic Co-Operation and Development estimates
the demand for global infrastructure will
require an annual investment averaging
between 2. 5 percent and 3. 5 percent of
the world’s gross domestic product
between now and 2030. CIBC World
Markets estimates governments around
the world will pump US$25 trillion to
US$30 trillion into infrastructure
and quite another to bring it to
fruition. And for the megaprojects to
have any true impact in turning
around the abysmal economy, project
teams have to be able to cut costs and
better manage risks. And that can
take years of commitment from experienced project managers who understand how to navigate the political,
financial and structural baggage that
are part and parcel of the massive
check out page 12
of The Buzz.
ECONOMY DRIVES SCRUTINY
U.S. President Barack Obama has
promised to devote billions to infrastructure projects. But there are
already questions popping up about
his big plans.
The U.S. government has no real
infrastructure vision of what is needed
to compete in the globalized marketplace, create industrial jobs and be a
successful economy, says Norman
Anderson, president and CEO of
CG/LA Infrastructure LLC, an infrastructure project identification and
development firm in Washington,
“Without that vision, it is very difficult to make decisions on priority or
strategic projects,” he says.
With the downturn in the economy there is
an increased level of scrutiny on all supplies
and accounts. And there is a greater
element of caution in project decision-making.
—Man Chai, PMP
He’s also concerned that private
industry players don’t have enough
financial investment in the outcome
of the projects.
“If private firms have [a stake in the
project]—in terms of making investments or leveraging their balance sheet
investments over the next two decades.
The report predicts that China alone
will spend almost 80 percent of its nearly
$600 billion stimulus package on infrastructure.
Yet it’s one thing to acknowledge the
need for infrastructure development