IPA recently completed a detailed study on China capital projects. The study relied on data from over 120 capital projects executed by 37 American and European companies between 1998 and 2009 in China, representing over US$7 billion in capital project work. The study included projects executed as part of joint venture (JV) agreements as well as projects that were wholly owned foreign enterprises. Many project types and various project sizes were represented. 

Building a facility in a China location continues to offer the potential for significant capital cost savings over similar facilities constructed in North America and Europe. However, these savings are not guaranteed by simply moving the facility to China. Projects that used best project practices like alignment with business, integrated teams, and high quality project definition were less expensive than projects that did not. Furthermore, the level of savings is affected by practices specific to China. Those practices include:

• Organizational structures (JV versus wholly owned; use of project management companies)
• Amount of local content (domestic procurement of goods and services)
• Approaches for working with Chinese Design Institutes (CDIs) and construction companies
• Contracting, procurement, quality control, and permitting strategies