Framework for Avoidance of Disputes Arising in the Construction Industry due to the Economic Crisis

Abstract

The economic crisis characterized by inflation and currency depreciation has severely impacted the construction industry, leading to project delays and suspensions due to funding shortages. Consequently, disputes within the construction sector have increased during this crisis, necessitating effective avoidance strategies to mitigate such issues in the future. Thus, this research aims to investigate how to effectively avoid disputes arising from an economic crisis in the construction industry. Accordingly, the study adopted a Delphi qualitative approach by conducting two interview rounds with 15 industry experts. Then the collected data were analyzed using manual content analysis. The study identified seven major causes of disputes during the economic crisis in Sri Lanka, including increased construction prices, material shortage, sudden suspension or closure of projects, job redundancy, importation-related issues, quality-related issues, and time overruns. Additionally, the research outlines strategies for project parties and the government to mitigate disputes in the industry during the crisis. The findings expect to address the critical gap by offering insights into dispute avoidance during economic crises, providing valuable guidance to the body of knowledge for successful project completion in challenging scenarios.