Legal risk impact in Public Private Partnerships (PPPs): the case of the Chinese water sector

Shrestha, A and Martek, Igor 2015, Legal risk impact in Public Private Partnerships (PPPs): the case of the Chinese water sector, World journal of management, vol. 6, no. 1, pp. 90-98.

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Title Legal risk impact in Public Private Partnerships (PPPs): the case of the Chinese water sector
Author(s) Shrestha, A
Martek, IgorORCID iD for Martek, Igor
Journal name World journal of management
Volume number 6
Issue number 1
Start page 90
End page 98
Total pages 9
Publisher World Business Institute
Place of publication Melbourne, Vic.
Publication date 2015-03
ISSN 1836-070X
Summary China is currently experiencing a rising demand for water, combined with limited funding availability for water project procurement. Consequently, local Chinese governments have sought procurement solutions by experimenting with public private partnerships (PPPs). However, the legal risk in PPPs, particularly in the water sector, remains high. Legal risk refers to risk arising from the legal and regulatory systems surrounding PPPs. Past research have identified legal risk in PPP projects in China as critical, however the stages at which they are significant have not been studied. This paper examines the legal risk associated with PPPs in the water sector in China and measures the degree of risk across three key stages; 1) Procurement, 2) Construction and 3) Operation. The interrelationship between legal risk at these three stages is also investigated. The significance of the risk was measured by determining the probability and severity of the risk. Correlation analysis was used to investigate the relationship between legal risks across the three stages. Our findings are that legal risk is present at all three stages, at close to moderate levels, with risk significance greatest at the operational stage. Moreover, while no correlation was identified for legal risk at the operational stage with those of earlier stages, it was found that legal issues arising during the procurement stage significantly exacerbated any further legal issues that emerged during the construction stage of water projects. The findings from this study will be significant in providing practitioners with the information to manage this risk at different stages of PPP projects.
Language eng
Field of Research 120201 Building Construction Management and Project Planning
Socio Economic Objective 970112 Expanding Knowledge in Built Environment and Design
HERDC Research category C1 Refereed article in a scholarly journal
ERA Research output type C Journal article
Copyright notice ©2015, World Business Institute
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