THE IMPACT OF A SEVERE ECONOMIC AND FINANCIAL CRISIS ON CONSTRUCTION THE CASE OF LEBANON

Abstract

The Lebanese crises, including economic and political instability, have had a significant impact on construction projects and contracting companies in the country. The purpose of this thesis study is to document and evaluate this impact, by examining the challenges faced by both construction projects and contracting companies in the current climate. The study adopts both qualitative and quantitative research methods, including interviews with industry professionals and surveys of construction companies. Through this research, the study aims to identify the key factors that have disrupted the conventional way of administering construction projects, to assess the impact of the financial and economic crises on both construction projects and contracting firms, and to propose potential mitigation measures sorted according to Porter‘s strategies (1980) to address these challenges. In addition to the above, the study focuses on calculating the Relative Importance Index (RII) of factors causing delays for Lebanese construction crises and the effectiveness of mitigation measures adopted by practitioners amid the crises. The results of the RII analysis indicate that the most important factor causing delay during the financial and economic crises is the necessity for currency conversion for procurement purposes and the continuous fluctuation of construction materials. The study also finds that the most effective mitigation measure adopted by practitioners is to secure projects funded by foreign currency, decrease profit margins to secure more projects and others. This study provides valuable insights for policymakers, industry professionals, and other stakeholders in the construction industry to address the challenges faced by construction projects and contracting companies in Lebanon.