The Chinese Construction Firms' Project Risk Management In Pakistan's Construction Industry

Construction projects are highly risk prone,with many unique features such as involvement of many participants(clients,designer,consultant,and contractor),long period of construction,complex and dynamic project environment,and large financial requirements.Overseas construction projects are associated with more risk as compare to domestic projects because identifying new risks in new environment is very difficult and costly.Implementing projects in foreign construction market tend to be subjected to the uncertainties,especially in terms of external risks.Implementing projects in Pakistan's construction market for foreign contractor is high risky business activity.Identifying the factors that can provide potential future losses warnings is very difficult for a new comer in a foreign construction industry.Efficient risk management technique is required to decrease the probability of challenges,discordance,overrun of time and cost and decrease the issues related quality of construction projects.The aim of this research is to highlight the risks associated with Chinese construction firms' projects in Pakistan's construction market and identify risk management practices and barriers to risk management implementation.Online questionnaire survey was conducted to collect the data from Chinese construction firm's projects in Pakistan construction industry.The top ten risk factors identified from a questionnaire survey are official changes,political instability,policy changes,water crises,currency fluctuation,poor site condition,design failure,security problem at project site,different construction standard,and energy crises.The top three risk factors out of ten were political risk.Identification of political risk in international construction is essential and can be very difficult task to accomplish.Some strategies such as transfer of risk by contract,transfer of risk by insurance,and managing and pricing the retained risks need to be applied on international construction projects.Selecting a suitable partner,strong relationship with the host government,learn about the local culture and tradition,experience and reputation are the factors,a foreign construction firm should consider when implementing a construction project in Pakistan.