Review: Risk assessment of infrastructure projects on project cost

Abstract

Infrastructure projects such as highway, railway, airports, power stations and ports play an important role in the development of a country. However, past studies reported that most of the infrastructure projects experienced cost overruns with an average of more than a quarter higher than the original cost. Previous studies concluded that risks occur in the earlier project procurement stages especially tendering stage, is more likely to cause significant impact on the later stage (construction stage). From the literature review, it can be concluded that most of the studies focused on the construction stage in assessing the risk factors on the infrastructure cost. The literature review discovered that most of the research were carried out on bridges, railway and transportation, in developed city such as China, Hong Kong, and Australia, instead of Malaysia. In conclusion, risk assessment in infrastructure projects during pre-construction stage is important as it helps to provide some guidelines to the industry professionals to improve their existing risk management plan as well as their decision making. Thus, an on-going further study is conducted to identify the critical risks in infrastructure project costs during tendering stage.