Leighton’s King predicts better times

Wal King, CEO of Leighton Holdings, which ranked 28 in iC's global top 200 contractors this year, has said he's upbeat about the future.

Addressing the current economic climate in a ‘preparing for the upswing' speech, Mr King said, "This downturn really needs to be put into context. In the history of the world economy, we are going through a flat spot. The best years are still ahead of us."

Mr King believes our economy is driven by demand for natural resources and that we can expect our standard of living to continue to rise as the world population grows to nine billion people by 2050, powered by economies like China and India.

On the subject of infrastructure, Mr King believes in Australia alone engineering construction will grow to AUS$ 140 billion by 2018, and that even before the global financial crisis there was a backlog of infrastructure projects that constrained the country's economy.

"The federal government is to be congratulated for moving to address some of the shortcomings," said Mr King. "The need now is to advance those priority projects more quickly than traditional procurement methods would normally allow."

Admitting the availability of project finance still presented a challenge, Mr King said, "The situation requires governments to engage in a genuine partnership with the private sector to get projects moving."

Mr King believes the traditional methods for procurement are flawed in terms of rapid implementation and as well as long lead times they lead to projects running over budget and behind schedule.

"We need an appropriate model for project procurement that will work better in the current economic environment," he said.

"Alternative models such as alliance contracting allow phases of projects to be carried out concurrently rather than sequentially. I believe this method offers the best and quickest way to get projects started.

"In the current circumstances, speed is of the essence and public servants need to acknowledge that a trade-off may be required," he said.

In closing, Mr King said, "We'll emerge stronger if we act now to remove impediments to delivering infrastructure that will support long term economic growth."