Assessment Of Project System Vulnerability To Political Risks In International Construction Projects

It has been nearly 40 years since Chinese contractors enter the international construction market in 1978. It has made brilliant achievements after a tortuous development process. China's foreign contracting has grown over billions of dollars of international business. At the same time, the international political risk has made a devastating loss to Chinese contractors, but the research for the construction industry or project political risk is extremely scarce, and the assessment of political risks are more concentrated at the national level.From the micro level, the characteristics of the contractor and project will affect its political risk level, this research will rearch political risk from the perspective of project system vulnerabilities.First, the literature review identified 25 projects system vulnerability factors, then design a questionnaire based on the factors identified to collect data. Descriptive statistical analysis and exploratory factor analysis were conducted by SPSS 20.0 software.The initial 25 factors were divided into six categories from two dimensions of exposure and the capacity. The six factors and associated variables were renamed respectively as firm based exposure, project based exposure, transaction based exposure, core competitive capacity, relative bargain capacity, and integrate adaptive capacity. AMOS software was used to do the confirmatory factor analysis, structural equation models of exposure and capacity dimensions were obtained, the critical factors of project system vulnerability were determined according to factors influence weight.After weed out "level of public opposition to the project", "organizational culture", "market dominance of the firm"the three weight less than 0.5 factors, the remaining 22 indicators constitute a project system vulnerability assessment index system, as a building project system vulnerability measure model basis.Using sensitivity analysis to identify the sensitivity coefficient of each factor.Construction a project system vulnerability measure model based on Entropy and TOPSIS methods, and the vulnerability is divided into five grades. Finally, a number of case information obtained through the questionnaire to conduct empirical analysis, the results showed that the project system vulnerability measure model constructed in this study have some reliability and validity.The research is helpful to Chinese contractors in the international construction market when faced by political risk to execute front-end decision-making, monitoring and early warning and risk response.