Turmoil in the global economy is exposing an increasing
number of large projects to unprecedented productivity and
financial pressures. Severe microeconomic issues can arise on
projects that stem from unforeseen macroeconomic events. We discuss
this evolving situation and potential mitigants below.
Introduction
Turmoil is defined as "a state of confusion, uncertainty,
or disorder"1, or "a state of great worry in
which everything is confused, and nothing is
certain"2. Perhaps the standout word here in the
context of project execution is "uncertainty" which, from
a construction and engineering project stakeholder's
perspective, means a greater exposure to financial risks.
A combination of macroeconomic events has resulted in many
contractors on lump sum contracts suffering the impacts of
unforeseen and exceptional increase in costs of materials,
equipment, instrumentation, labour, and personnel. Some other
impacts to projects, not always immediately considered
