Risks Associated With Mega Infrastructure Projects

Year Published 2022
Business unit: Capital Projects Appraisal Unit (CPAU)
Resource type: Case study
File type: Microsoft Powerpoint
Theme(s): Procurement, Public Service & Administration, Public Works

Description

A presentation delivered by Bruce Dzenga (Senior Economist: Capital Projects Appraisal Unit) on 01 July 2022 as part of GTAC’s weekly webinar series. This presentation gives an overview of major risks associated with mega infrastructure projects given how prevalent these are in the current portfolio of public infrastructure investments. Megaprojects are characterised by high capital costs and benefits, years-long timelines, and complex contracting and procurement strategies, amongst others. As such, megaprojects can be catalytic and transformative in nature rendering them both strategic and necessary. However, their scale is such that whole nations may be affected for long periods of time by the success or failure of just a single project. Without fully understanding the risks associated with megaprojects, inherent and residual, proponents are unlikely to structure projects appropriately and ensure that risk allocation is optimal.

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