Modern history’s most famous “megaproject” went awry almost from the start.
France was riding high after completing the world’s most ambitious engineering marvel: the Suez Canal. More than a decade later, in 1881, the revered architect of the Suez project, Ferdinand de Lesseps, raised vast sums to underwrite an even more challenging plan to build a waterway across the narrow but mountainous isthmus of Panama. But de Lesseps’ team was unprepared for what awaited them in the topics -- humidity quickly rusted their equipment, and heavy rains could undo weeks of work in mere hours. More importantly, workers died so frequently from malaria, yellow fever, animal attacks, and accidents, that organizers began a massive cover-up. As deaths mounted it became impossible to even maintain an experienced workforce.
By the time France abandoned the project eight years later, 22,000 workers had died and nearly a million French investors -- including the bulk of the country’s once bourgeoning middle class -- lost their savings. Some historians say those losses and the ensuing “Panama Affair” helped hasten the end of France’s relevance as a global power.
The modern definition of a megaproject is one with a budget of at least $1 billion, with a multi-year timeline, directly and indirectly impacting millions of people, and involving multiple partners. Oxford’s Bent Flyvbjerg says such projects are “designed to ambitiously change the structure of society.”
“By their very definition, these ‘megaprojects’ are so large, so complex, so multifaceted, that it is almost impossible to know at the start how a project will end,” Andrew Davies, a professor in the School of Construction and Project Management at University College London, told Infrastructure Channel. “There are almost always unexpected problems, which is why deadlines are so often missed, often by great amounts, and why something like nine megaprojects out of ten come in over budget.”
But despite the costs, complexities, and risks of such projects, research from Oxford shows the number and scope of such projects launched each year is steadily rising over time, whether related to transportation infrastructure, water, energy, waste processing, mining, information technology, defense, or urban regeneration. Flyvbjerg says the combined investments in megaprojects will over time “dwarf almost any other economic figure” -- including countries’ gross domestic products or trade balances -- “and certainly any investment figure.” The McKinsey Global Institute five years ago estimated the world would spend $3.4 trillion, roughly the size of Germany’s economy, per year on megaprojects through 2030.
One of the most important an ambitious of these new-age megaprojects, one just getting started, involves nine separate “Core Network Corridors” aimed at drawing the member nations of the European Union closer together by road and rail. The centerpiece project -- itself a collection of megaprojects -- is the Scandinavian-Mediterranean Corridor, often referred to as ScanMed, which will link Malmo in southern Sweden to Palermo on the southern Italian island of Sicily, including connections in or near Copenhagen, Hamburg, Bremen, Berlin, Munich, Florence, Rome, and Naples.
Jacob Vestergaard managing director of the String Network, one of the main stakeholders in the northern part of ScanMed said the corridor’s two biggest challenges are an underwater tunnel called the Fehmarn Belt Fixed Link, linking the Malmo-Copenhagen metropolitan area to Hamburg, and another tunnel, under the Brenner Pass in the Alps, connecting Innsbruck, Austria, with Fortezza, Italy.
Once completed, the Fehmarn Belt Fixed Link, which will be the world’s largest immersed tunnel in the world, will reduce travel time between Copenhagen and Hamburg to 2.5 hours compared to 5.5 hours today, Vestergaard said. The 64-kilometer Brenner Base Tunnel will be the longest in the world when completed in 2026 and will nearly triple the amount of traffic through the pass compared to the current zig-zag mountain road and rail line. The costs of both projects will be recouped through toll charges and other user fees.
“The ScanMed Corridor is really a series of megaprojects and on their own, both the Fehmarn Strait tunnel and the Brenner Pass tunnel in the Alps would qualify as megaprojects on their own,” Vestergaard told Infrastructure Channel.
Parts of the network are already in operation: a high-speed rail line opened in Germany in December, for example, has reduced the time needed to travel from Berlin to Munich by nearly 2.5 hours, down to less than four hours total. On the southern side of the Brenner Pass, high-speed trains in Italy have since 2009 nearly cut the time needed to travel from Milan to Naples in half, to just over four hours.
“The corridor is a marvelous and ambitious project that will help link Europe in ways that would have seemed impossible in the past,” Vestergaard said.
Psychology says it is human nature to want to attempt what once seemed impossible. The same desire that led Tuscan nobility to construct ever taller towers during medieval times, for example, is behind the aspirations of those constructing modern skyscrapers. The same elements that motivated the great explorers of the Renaissance are now fueling the exploration of space.
One of the problems is that pushing those limits carries risk. Donald Lessard, a professor-emeritus of global economics and management at the Massachusetts Institute of Technology (MIT), said in an interview that one way to limit the risks when it comes to megaprojects is through centralized decision making and incentives for contractors to stay under budget and finish work on time. He refers to the famous “Big Dig” -- the colloquial name for the massive transportation and tunnel project near the MIT campus in Boston -- which ended up costing $14.8 billion despite starting with a budget of $2.6 billion.
“The ‘Big Dig’ went through 20 different cities, 20 different jurisdictions,” Lessard said in an interview. “It was a lack of controlling costs and coordination that got the project off track.”
University College London’s Davies is among those working on guidelines to make it easier to assure that costs and other projections for megaprojects are close to the mark, including learning from the experiences of previous projects, organizing projects to allow for unexpected developments, using of off-site trials to work through problem areas, correctly gauging risks, and relying on innovation.
Nick Garemo, from McKinsey & Co., says limiting risks and costs involves confronting another side of human nature.
“The guy making a bid on something is thinking, if I can get approved for this I know I’ll have a job for the next six years,” Garemo told Infrastructure Channel. “It’s not really being dishonest, but it is being a little overly optimistic at the margins. And with big projects, that can have big consequences.”
By the time they abandoned the Panama Canal, the French had sunk nearly $300 million (the equivalent of nearly $8 billion today) into the project, and de Lesseps, his son, and engineer Gustave Eiffel (who a few years earlier designed Paris’ Eiffel Tower, a megaproject in its own right) were all prosecuted for fraud. The project was sold to the U.S. for $40 million (less than $1 billion today) in 1903, but the government of Colombia -- which controlled Panama at the time -- refused to approve the deal. So the U.S. threw support behind a fledgling independence movement and the modern Republic of Panama was born.
U.S. engineers invented several kinds of larger and more powerful tractors and cranes to use in Panama. All told, 130 million cubic meters of earth had to be displaced for the project, in addition to the 23 million cubic meters already moved by the French. Vaccines were created to protect against insect-borne diseases and worker safety methods to prevent on-the-job accidents. The 77-kilometer canal, dubbed one of the seven wonders of the modern world, opened in 1914. It shortened the maritime route between New York and San Francisco by two-thirds, and remains one of the world’s most important commercial waterways.
“More than a hundred years after it opened, the Panama Canal is one of the world’s most important achievements, with aspects related to engineering, disease, geo-politics, transport, worker safety,” Darrel E. Johnson, a University of Texas system development historian who has written about the Panama Canal, told Infrastructure Channel. “It has lessons that are still relevant today. Among them: No project is too complex. Big projects remain questions of will, determination, and problem solving.”