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Collaboration is key in challenging global market, CIOB conference hears

27 November 2015

International collaboration is key to addressing the acute skills shortages and financial challenges in the UK construction sector, delegates at CIOB’s International Inspiring Construction Conference at the Queen Elizabeth II conference centre in London heard on Tuesday.

The conference followed on from the Global Construction 2030 report which predicts that the UK will become Europe’s largest construction market by 2030 – and that the majority of the work is likely to be funded by overseas investment.

Contractors were therefore urged to overcome cultural barriers and contemplate new business models to adapt to an increasingly globalised marketplace.

The speakers sharing their strategies for entering and operating in new markets included Dr Jianxi Cheng, project manager for Chinese developer Wanda One, which is building the One Nine Elms tower in Battersea; Thomas Wilson, of law firm Squire Patton Boggs; and Arnaud Bekaert, managing director of construction for Bouygues UK.

Chris Blythe, chief executive at the CIOB, said: “The increasingly globalised construction market is helping our industry seek new solutions to the skills shortages and financing restrictions that continue to hamper our sector. By blending working cultures and sharing best practice, international collaboration can help us find new approaches to age-old problems.”

"British consultants in particular have an excellent reputation worldwide. By going through the first wave of Chinese-funded projects in the UK, they can develop a joint force with their Chinese colleagues to export their expertise elsewhere."

Dr Cheng said that Chinese contractors were keen to partner with European organisations and would be investing in subsidiary companies to grow their presence in the UK. He said: “Over last 10 years, China has invested up to £25bn in the UK, but over the next decade expects to invest £105bn in infrastructure alone.

“The trickle of investment is becoming a wave. There are opportunities for both sides. Chinese and British companies need to go through a learning curve to develop their joint innovative and management capabilities.

“British consultants in particular have an excellent reputation worldwide. By going through the first wave of Chinese-funded projects in the UK, they can develop a joint force with their Chinese colleagues to export their expertise elsewhere. It’s a natural route to improving British competitiveness. The issue is how is each business going to adapt into each other’s style? It’s important to recognise the subtle cultural differences, and create a joint solution for success.”

He predicted international opportunities for local firms that formed long-term relationships with Chinese partners, and urged potential partners to overcome the language barrier. “The language barrier is a trivial matter. The idea that the Chinese can’t speak English and that the English can’t speak Chinese is overstated. It is the small cultural differences that we need to learn to overcome,” he said.

For contractors seeking work in the Gulf states, plunging oil prices are forcing a radical rethink, but increasing opportunities for different approaches, according to Thomas Wilson of law firm Squire Patton Boggs.

Wilson warned that contractors working in the Gulf were increasingly being asked to redesign and scale back projects and were at higher risk of late or non-payment problems.

But he added that several governments were introducing public private partnership (PPP) legislation and seeking partners that can finance projects at construction phase.

Thomas Wilson: Gulf risk

He said: “The move towards PPP and privately financed structures in the region will result in a more amenable market for contractors. It will create a more stable environment for better designed and better managed projects which will, if not lessen the risk for contractors, at least make risk more identifiable and predictable.

“But if you come to the Gulf, don’t come alone. Take advantage of the number of contractors that have already learned hard lessons, and form joint ventures with regional players.”

Other speakers at the event tackled the subject of SMART cities, gave advice on how to deal with imperatives and showcased innovative case studies from around the globe.

Alongside the main conference, a series of Continuing Professional Development seminars covered issues ranging from waste, leadership and recruitment to project control.

All of the CPD presentations will be made available to CIOB members on the CPD portal in the near future.

The event closed with the first screening of “Building Tomorrow”, a special co-production between the CIOB and ITN Productions. The film, introduced by national newsreader Natasha Kaplinsky, explores how technologies are transforming the face of the industry and disrupting traditional models.

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