Predicting the Impact of Country-Related Risks on Cost Overrun for Overseas Infrastructure Projects

Abstract

Given the complexity of overseas infrastructure projects (OIPs), difficulty in managing country-related risks commonly causes cost overruns. Thus, there is a pressing need for proactively predicting the impact of country-related risks to enable reasonable decision making in the early proposal stage. Different from the previous studies that heavily relied on a large number of sample points, this research proposes a case-based reasoning (CBR) method capable of reliably predicting the impact of country-related risks on cost overruns for OIPs from a small size of sample points. Grey relational analysis (GRA) is applied twice to address the challenges associated with many variables. Finally, a case study is conducted to validate the reliability of the proposed method. Importantly, this research includes a structured process to develop CBR methods for prediction tailored to different construction companies, hence increasing the adaptability.