Impact of political risk on construction cost in PPP project in KSA

Abstract

The primary purpose of this research paper is to investigate the impact of political risk factors in the lifecycle of Public-private partnerships (PPP). Due to a large number of stakeholders in pPPP projects, the complexity of interactions between them increases which raises the importance of this study. Throughout an intensive literature review, this research paper extracted the most influential factors that impact the (PPP) projects, especially factors that impact the cost overrun, project termination, and project delay. The research methodology was applied is based on evaluating the risk factors extracted from the literature review on the probability of occurrence of the event and the size of the impact to result of the risk effect value. Data were collected from a questionnaire shared with experts in the field of construction to enhance the accuracy of the estimated risk impact. The analysis of the data gathered and the ranking of the political risk factors resulted in measures of the Risk Likelihood and Risk impact of the ten most impacting factors. The research concludes that the relationship between the impacts of risk factors is associated with the risk cost and actual construction price.