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October 16, 2019

Ethiopia made the top 10 list of ACE targets for UK consultants

New Civil Engineer BY MARK HANSFORD

Ethiopia, Malaysia and Mexico are among the 10 top targets for UK consultants seeking to export their expertise in post-Brexit Britain, according to new research from the Association of Consultancy and Engineering (ACE).

China, the world’s biggest construction market making up 23% of the entire global construction output, fails to make the list which has been derived by consideration of size of market, growth potential and other key factors such as potential for corruption, rule of law and transparency.

But the ACE says that there are better targets in a post-Brexit world. By size of market, the US, India and Indonesia are the top targets identified, with cumulative construction outputs between 2018 and 2030 valued at $22.9tr, $10tr and $6tr respectively. Germany, Australia, Canada and Saudi Arabia make up the top 10.

“Ethiopia is one of the more controversial countries on our list,” said Graham Robinson, director of construction trends forecaster Global Construction Perspectives, who carried out the research for the ACE with think tank Oxford Economics.

Addis Ababa

“But it is a simple case of follow the money,” he said, explaining that Ethiopia was one of the biggest beneficiaries of UK overseas aid and that it also benefitted from significant funding from the World Bank. Robinson added that Ethiopia is currently rated 123rd out of 141 countries in terms of quality of infrastructure and, with a rapidly growing working age population, was set to invest heavily between now and 2030 in large scale and city-wide masterplanning.

The US and Germany were picked out as top targets because of their legacy of ageing infrastructure that is now in serious need of maintenance. India and Indonesia were identified because of the opportunities for masterplanning driven by the rapid expansion of their cities. And Australia and Canada were identified because of their huge ongoing new-build infrastructure programmes.

The ACE’s global export strategy was published yesterday alongside its vision for the future of consultancy, aimed at putting consulting engineers back at the top table after years of ceding power and influence to others in the construction supply chain.

“The reputation of consultancy needs to be repositioned,” said ACE chief executive Hannah Vickers, speaking the strategy launch. “It needs to move up the supply chain.”

The strategy has three key strands aimed at putting consultants at the heart of strategic planning and placemaking, setting their role as key in delivering integrated projects, and using data to improve performance of assets in operation.

The ACE’s year-long research has led it to believe that consultants are currently typecast as focused largely on the design phase.

Explained ACE vice chair Craig Huntbatch: “At present our capability is predominantly deployed during the construction phase which is only 6% of UK GDP. This is a huge opportunity.”

The strategy also reflects on growing calls for the industry as a whole to move towards more outcome-based payment and reward mechanism, such as proposed by the ICE-backed Project 13 initiative.

But Vickers said that while the ACE acknowledged the shift towards different reward mechanisms it remained agonistic on business models.

“There is not one model. What we see is a suite,” she said. “A lot of current models currently reward on inputs, such as time. What we are proposing is a move towards reward on performance.”

She added that any transition would take time and that different clients and different consultancies will move at different speeds – and that existing practices would not become obsolete overnight.

“It is quite a fundamental shift and clients buying on value is a different commercial model and it disrupts the supply chain,” she said. “This has to be about creating sustainable businesses.

“This is not about [using technology] to design something in 15 minutes that would have once taken six months, and then getting paid for 15 minutes.”

Next steps for the ACE include working with insurers to develop professional indemnity insurance products that reflect the increased risk in taking on work on a payment-on-results basis and development of a transparent supplier performance system in conjunction with the government-backed Construction Innovation Hub and the Treasury’s Infrastructure and Projects Authority, which would allow public sector clients to have more confidence in past performance and so allow them to award contracts on a repeat business basis, moving away from a low-cost tender mentality.

Source New Civil Engineer

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