Property, Politics, and Power: Theorising Political Risk in the Mining Industry

Abstract

Political risks are critical variables for investors to consider when undertaking business in a globalised economy. Yet the concept itself remains under-theorised and, consequently, suffers from a lack of conceptual clarity. Attempts to define political risk thus far have failed to consider and analyse how the concept is theoretically grounded. This has led to a significant knowledge deficit and to a lack of consensus as to what constitutes the idea of political risk. This chapter addresses this deficit by exploring the theoretical nature of political risk. It examines the inter-related elements of property, politics, and power to develop a new understanding of how these elements underpin the idea of political risk. This chapter is, therefore, theoretical in nature. As such, it does not directly address risks, challenges, and opportunities facing the mining industry in the Asia-Pacific Region. Instead, it examines key ideas that inform the idea of political risk. It will be up to individual mining companies to adapt these abstract ideas to their individual circumstances.