Project risk refers to the possibility of loss due to the existence of various uncertain risk elements throughout the project. In all aspects of the project there may be risks, the risk characteristics of international engineering and construction projects are mainly manifested in the following aspects.
1.1 correlation
International engineering and construction project risk from the beginning of the design, to the end of the commissioning, each of which interacts with the other links. Maldives housing project phase II must be taken into account in the design of the material procurement of various factors, due to the Maldives own construction materials are very scarce, the use of plumbing and electrical materials is different from the standard of China, so the country needs to take into account the factors of material procurement when carrying out the design.
1.2 Dynamic
Because of the international engineering and construction projects are generally longer, the risks that should be faced in each link are not consistent because of the face of different subjects, so the risk will show dynamic. For example, in the sand, cement, steel and other raw materials procurement process, need to be purchased from China or other neighboring countries, the delivery time of the material due to the uncertainty of the delivery, shipping and other aspects of the influence of the time of arrival of the material is also inconvenient to determine.
1.3 Complexity
In general, compared with domestic construction projects, international engineering construction projects appear more complex. As the tiles in the construction materials are fragile, it is difficult to control the amount of loss in the process of transshipment which may be affected by the time of transshipment, the working attitude of the laborers, the performance of the machinery and equipment, and so on. In terms of the use of labor, due to the large number of laborers from other countries, it is inevitable that all kinds of unforeseen problems will occur in the management process. In the maintenance stage, due to the influence of the rainy season, the floor slab absorbs water and expands, resulting in problems such as warping and hollowing of floor tiles. This greatly enhances the complexity of international engineering.
1.4 Novelty
International engineering and construction projects a large number of engineering practical experience and historical data have not been well accumulated, the implementation process on site will find a lot of new problems, can not get the many good experiences of previous construction projects, so the international engineering and construction projects show its novelty.
2 The main types of international engineering construction project risk
The factors affecting the risk of international EPC projects are diverse and intricate, and the influencing factors can basically be summarized into the following six categories, including external factors: natural risk, political risk, economic risk and social risk, etc.; internal influencing factors: management risk, technological risk and so on.
2.1 Natural Risk
Natural environment is the most obvious influence of all construction projects, due to the general construction project construction period is relatively long, whether the construction project can withstand the test of the natural environment, to a large extent, determines whether the construction project can be completed safely, but also on the civilization of the construction of a great impact. Such as the Maldives climate is not like the domestic, four seasons, but has been in the state of high temperature, strong sunshine, concrete in the maintenance process, if not effectively controlled, it is easy to lead to cracks. On the other hand, when the rainy season comes, due to the heavy rainfall, the rain is rapid, and long and non-stop, resulting in construction progress is often blocked, the situation of work, and therefore is bound to increase the project management costs. In addition, the Maldives is in the tropical region, malaria, project management personnel or Chinese workers and local people, compared with the physical condition, not well adapted to the local environment, prone to dengue fever and other diseases, coupled with the local medical conditions are far less than the domestic, the staff in the body may need more time to recover. Therefore, the natural risk from all aspects of the international project construction engineering has caused a considerable impact.
2.2 Political Risk
The political stability of each country will have a heavy impact on the safety of infrastructure construction in their own country. As in the signing of the contract basically clearly stipulates that the political risk will be borne by the owner, but they often try to avoid the risk through various ways, leading to the problem that the contractor can not get the relevant compensation. In addition, due to the inconsistency of the legal policies of different countries, there is no guarantee of stability, and in the process of construction, there may be problems of violating local laws, which will also affect the progress of the project. Therefore, political risk is one of the overseas projects that cannot be ignored.
2.3 Economic Risk
Since the exchange rate of the two countries' previous currencies is in a fluctuating state, it leads to the contractor to bear certain economic risks. In addition, rising prices, the cost of material procurement instability, and project contracts are generally signed in the form of fixed lump-sum contracts, resulting in international engineering and construction projects in the actual conduct of the process to be faced with unforeseen problems. At the same time, due to the larger scale of international engineering projects, involving more liquidity, progress payments and retention money, the contractor must have sufficient economic resources, and before and after the bank loan, but also to bear a certain degree of economic risk.
2.4 Social Risks
Social risks generally appear in the form of cultural differences, religious beliefs and social stability. First of all, the cultural differences between the owner's country and China are different, which requires Chinese employees to have an understanding of the local customs before entering the project, so that they can pay attention to avoid problems in the future work. For example, the Maldives prohibits the consumption of alcohol, pork, etc., which requires Chinese employees to be strictly self-disciplined and not to engage in behavior that is contrary to local customs. Secondly, due to the political turmoil of the government of the country, the problem of social stability is more serious at a certain stage. The project department requires that no one should go out at night to avoid personal injury.
2.5 Management Risk
Since project management covers design, procurement, construction and other aspects of the project in the actual operation of each link has a complex correlation between each other, the impact of the larger, so the management of the difficulty is also greatly enhanced for the international project, the management risk is more serious. A lot of management work is more complicated compared with domestic projects. For example, in terms of labor management, due to the introduction of a large number of Bangladeshi laborers in the second phase of the Maldives housing project, due to differences in living habits, religious beliefs, language exchanges and management personnel and problems, labor management issues can not be ignored.
2.6 Technical Risk
Generally speaking, the technical requirements of international projects are relatively high, so the contractors are also required to have strong technical capabilities, which also includes whether the geological survey is comprehensive and whether the design specifications are familiar. For example, the second phase of the Maldives housing project is different from the domestic plumbing and electrical installation, the relevant norms and standards differ greatly, so from design to construction have to bear certain technical risks. Therefore, if the contractor can not guarantee a high standard of design and construction capabilities, even if the bid is awarded, may not be able to ensure that it can be successfully completed.
3 Risk control measures for the second phase of the Maldives housing project
3.1 Contractual claims risk control
Compared with the domestic construction projects, the international projects are more strictly adhering to the terms of the contract, and all the claims will be in strict accordance with the contract. Although more and more overseas projects contracted by China in recent years, but there are also many projects with huge losses, so the project contract risk comprehensive avoidance can not be ignored. Before bidding and signing the contract of Maldives II project, the company has arranged many times for the personnel to conduct site visits to Maldives, and thus can have a full understanding of the national laws of Maldives on the basis of avoiding the project in the process of implementation of the passive situation.
3.2 Construction cost risk control
1) Strengthen the design optimization work. This project firstly carries out functional analysis and functional evaluation, combined with economic comparison analysis, and carries out optimization design work. On the one hand, it is conducive to the control of cost, at the same time, after a number of design options, the function of the building product is also more reasonable, while reducing the construction cost to ensure that the value of the project is enhanced.2)Strengthen the control of logistics risk. If the cost of logistics and transportation is not well controlled, it will bring more risks to the project. All materials of this project are purchased from China or neighboring countries of Maldives, and the poor control of materials and machineries in the time before leaving the port and after arriving at the port results in stranding in the port, which costs a huge amount. Therefore, the time should be estimated before the goods are assembled in the port, and the manpower should also be arranged before arriving at the Maldives port of entry, so as to avoid stranding in the port. As this project is a national preferential project, some cargoes are given tax exemptions, so before the cargoes are shipped, the tax exemption list should be reported in time and the owner should be actively communicated with in order to avoid stranded ports. The project also examines the local freight forwarder and intends to sign a transportation contract to control the transportation risk.
3.3 Project Management Risk Control
On the one hand, the project is analyzed by risk management before implementation, risk prevention system is established, and scientific methods are used to plan the construction of the project to avoid predictable risk events. On the other hand, the project department is formed by selecting only the project management team with strong working ability, so as to effectively manage the construction team. At the same time, the professional skills, foreign language communication ability, organization and coordination ability of the managers are all criteria for selection. In terms of labor, "On-site Labor Management Measures" is specially prepared to manage the laborers in an orderly manner, and at the same time, the form of mixing and matching between Chinese and Bengali laborers is adopted, in which the Chinese workers will be taught by the Chinese workers in the early stage, and then after the Bengali laborers have become skilled, the ratio of the number of Chinese laborers to the number of Bengali laborers will be raised, which also reduces the cost of the construction.
4 Conclusion
China's domestic construction enterprises want to grow, we have to go out of the country to build international projects. So this requires our enterprises to have a high level of technology and management based on the international project, but also have a deep understanding of the norms. At the same time, it also requires employees to be able to break through the language barrier and enhance the ability to adapt to new environments. Of course, compared with domestic projects, cultural differences, security restrictions, lack of materials, labor procurement and other aspects of the problem is more prominent, so we must comprehensively overcome all kinds of problems in order to ensure that foreign projects can be completed in high quality, in order to emerge more "China's creation".
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