Globalization and construction industry development: Implications of recent developments in the construction sector in Asia

John Raftery, Bernie Pasadilla, Yat Hung Chiang, Chi Man Hui, Bo Sin Tang

Research output: Journal article publicationJournal articleAcademic researchpeer-review

117 Citations (Scopus)


Recent developments in the construction sector in the Asian region demonstrate three trends: (1) larger private sector participation in infrastructure projects, (2) increasing vertical integration in the packaging of construction projects, and (3) increased foreign participation in domestic construction. This paper attributes the trends to the globalization and deregulation of markets necessitated by fiscal, technological and managerial constraints. Although these trends present intra-Asian opportunities, there are also areas of concern. The trends have helped polarize the financial and technical superiority of the developed countries and the corresponding inferiority of the developed countries in the region of the developing ones. In the long term, this gap could be filled through technology transfer. In the short term, however, there are concerns that imported construction services could grow at the expense of the indigenous sectors of the developing countries. This paper illustrates this dilemma with the case of Japan as a world leader in international construction services. Its dominance has apparently come through the orchestration of industrial and corporate policies, implemented in a highly regulated and protected domestic market. However, construction industries in other Asian economies (such as China) will have to leapfrog in technology, finance and management know-how (e.g. through joint ventures with developed countries' construction companies) before they can become formidable powers in an environment that has become much more global, more de-regulated, more open and more competitive than before.
Original languageEnglish
Pages (from-to)729-737
Number of pages9
JournalConstruction Management and Economics
Issue number6
Publication statusPublished - 1 Jan 1998


  • Asia
  • Construction
  • Construction industry development
  • Globalization

ASJC Scopus subject areas

  • Management Information Systems
  • Building and Construction
  • Industrial and Manufacturing Engineering


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