So is it a problem that UK-owned contractors are so poorly represented on the world stage? If you’re in the boardroom of a top 50 UK contractor, the answer has to be “sorry, don’t think so” — if you’re surviving in today’s competitive world then you’re doing well by anyone’s standards, never mind taking on multiple commercial and legal risks just for the cheap thrills of overseas trips on exes.
As an industry, though, it looks a bit different. The arguments against over-extending overseas apply equally to BAM, Skanska or Bouygues, and certainly haven’t held them back. In contrast to the relative plenty from the mid-90s to 2008, we now have more capacity in the UK than demand — so why not spread ourselves a bit further? For mid-career construction managers, working overseas can build personal skills and capacity. And there’s not much point calling ourselves a “world-class” industry if no one outside the UK knows or cares.
At government level, it’s easy to understand the frustration of UK Trade and Investment chief executive Nick Baird. Our architects and engineers are overseas already, and by adding contractors to the chain we can deliver the value, innovation and sustainability expertise that makes businesses grow and that flows increased revenues into the UK economy. Add market entry for product manufacturers, and spin-offs for City banks, insurers and financial services … small wonder he’s berating contractors for staying at home.
UKTI is taking action through the High Value Opportunities programme, hoping to position British consultants and contractors to win infrastructure contracts from overseas governments. Part of its game plan is to broker consortia relationships among contractors, as seen with Crossrail tunnelling contracts. But it isn’t just about the heavyweights, a UKTI spokesman told CM that it’s talking about “opportunities for small and medium sized niche contractors, particularly in the low carbon and energy saving sectors”.
But as Graham Robinson of Pinsent Masons commented in our feature, you either have a global mindset and see yourself as an international player, or you don’t. UKTI has a tough job on its hands.
Of course, if we’re urging UK contractors to take on the risk of overseas contracting precisely when their margins are tiny and working capital to cover overseas operating expenses is in short supply, then we’re asking a lot. But ducking the issue and instead relying solely on the domestic market is hardly risk-free either.
UKTI would say this post-Olympic moment isn’t just about sitting back and waiting for overseas investors to get off the plane, but about selling the “Great Britain Delivers” message to overseas. And a first step might be a bit of soul-searching as to why the construction managers of 30 or 40 years ago took on the kind of risks we deem too high today.
Elaine Knutt, editor
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