Abstract
Contracting in international high-speed railway (HSR) projects is a risky business. The success of these projects and the sustainable development of international contractors are inseparable from effective risk management. However, limited research has been conducted to investigate the political risk involved in international HSR projects. As HSR development is becoming a more major part of the global construction market, this paper investigates the political risk factors specific to the projects and the relationships among the factors. Through a literature review and a pilot interview conducted with five Chinese professionals, 26 political risk factors were proposed. A questionnaire was then administered to 112 experts from both academia and industry to assess the significance of the factors. By applying partial least-squares structural equation modeling (PLS-SEM) technology, the 26 factors were clustered into eight groups, and 10 significant risk paths were identified. Specifically, “government attitudes” can directly influence the “investment profile” and “social support” can directly influence “government attitudes,” while “government instability,” “economic climate,” “financing and costs,” “external interference,” and “contractors’ operations” can indirectly influence investment profile by directly influencing “government attitudes” or “social support.” The findings of this study can assist international contractors with gaining a clear understanding of the political risk involved in international HSR projects, which will lead to more effective political risk management as well as better business decisions. Furthermore, this paper will contribute to the global body of knowledge in the area of political risk management for large-scale international projects.
Highlights
High-speed rail (HSR) refers to railway transport traveling at a speed of over 200 km/h on upgraded regular lines or 250 km/h on unique greenfield lines [1]
The findings enable international contractors to better understand political risk in international HSR projects and to be more prepared for risk management when engaging in these projects, significantly contributing to best practice
A systematic literature review was first carried out to identify the related political risk factors through the following four phases: (1) the research papers were selected by using the retrieval system of Web of Science; (2) the papers were limited to TOPIC or AND Document Type (Article or Review) AND Timespan (1900–2019) AND Language (English); (3) the received documents were further screened to ensure the papers met the research requirements and the journals relating to this research topic were double-checked to ensure there were no other potential documents; and (4) a total of 24 potential political risk factors were proposed by reviewing the final 928 valid papers
Summary
High-speed rail (HSR) refers to railway transport traveling at a speed of over 200 km/h on upgraded regular lines or 250 km/h on unique greenfield lines [1]. The first HSR line was in Japan and began operations in 1964. Over the past five decades, HSR technology has been applied widely and developed rapidly. Large numbers of HSR system have been built in the United States, China, Austria, Japan, Ireland, Belgium, Poland, Germany, Italy, Morocco, Netherlands, Portugal, South Korea, Sweden, Spain, Taiwan, Saudi Arabia, Turkey, Uzbekistan, and the United Kingdom. The booming global HSR market offers tremendous business opportunities for international contractors. Envisioning potential market shares and high gains, more and more international contractors have expressed their willingness to participate in the execution of international HSR projects [2]
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