Nearly 60% of Latin America’s largest 100 projects have fallen behind schedule since being launched, with estimates of cost overruns amounting to over US$133bn according to BNamericas, Latin America’s leading source of business intelligence.
In over 18 months of research, the team has utilized academic and industry best practices through collaboration with leading academics, at the University of Oxford’s Saïd Business School, to build a unique and growing database of project performance in Latin America.
The research by BNamericas’ newly launched Project Risk Analytics unit found that 58% of the largest tendered, under construction and recently completed projects have been delayed while over half of the projects have seen costs soar above original estimates.
Schedule overruns experienced to date have amounted to nearly 22 months on average or 45% greater than originally scheduled.
Cost overruns have proven to be even more significant. Whether through increased capital expenditure, injections of working capital, cost inflation or mandated changes in scope, the top projects in the region are currently 63% over original cost estimates on average.
From an original announced aggregate of US$243bn, total cost expectations now stand at US$376bn, 54% or US$133bn over initial expectations.
“The results of our research indicate that budgeting and planning of large infrastructure and energy projects in the region have been far too optimistic in recent times with stakeholders underestimating the difficulties involved in all stages from planning to construction,” said Natan Levy, head of Project Risk Analytics at BNamericas.
“The findings of our research have clear benefits for the consideration of the risks involved in large industrial projects in the region. We hope it will assist contractors, project financiers, insurers and all firms and public bodies involved in the development of the region’s infrastructure to improve future project planning at all stages,” said Greg Barton, founder and CEO of BNamericas.
Also see BNamericas’ opinion piece on the subject by clicking here
For further information please contact:
Natan Levy, Head of BNamericas’ Project Risk Analytics –
firstname.lastname@example.org – +56 (2) 2941 0386
Arvinder Ludhiarich, Commercial Director – email@example.com – +56 (2) 2941 0300
BNamericas delivers on-the-ground insight and trusted business intelligence to companies and investors in Latin America. BNamericas analyzes macro movements that affect everyday business and future developments, including social, political, economic, regulatory, technological, financial and labor-related coverage. Connecting our clients with trustworthy and timely insights, focused on 12 industry sectors, BNamericas has been shaping the development of Latin America for 19 years.
About BNamericas Project Risk Analytics
BNamericas’ Project Risk Analytics tracks changes to estimates of project completions dates and overall costs, in Latin American infrastructure, energy and mining projects.
Governments, insurers, reinsurers, project financiers, risk officers, asset managers and advisers can use this information to analyze upcoming risk to schedules and financing costs, and track the progress of existing projects for risk management purposes.
By providing a top-down analysis of the timeliness and costs of current Latin American projects, BNamericas provides a new tool to the industry, allowing it to learn from past events and improve planning for future projects.
In collaborating with the Major Projects research group at the University of Oxford’s Saïd Business School, BNamericas utilized the expertise of leading practitioners. The research group is world-leading in its field with the most cited articles in the field of major projects, programs and megaprojects in a wide area of industries, such as transport infrastructure, energy, civil engineering, IT and mega events.
Researchers advised and reviewed the methodology used by the team and offered advice on structuring the data analysis to make sense of the results. This collaboration ensured that the data and the results are highly robust following international best practice in terms of data collection and analysis.
Media Contact: Natan Levy, BNamericas Ltda, +56 (2) 2941 0386, firstname.lastname@example.org