Political Risks Challenges in the South African Construction Industry

Political risks (PR) relate to all diverse governmental rationale occurrences that may have a negative influence on a construction project such as influencing project investments and contracts. Furthermore, PR is crucial to construction stakeholders even though there are challenges that are faced when performing a risk assessment. PR includes changing laws, and intervention by foreign governments in a project, to name a few. As such, this study will assess PR challenges that are experienced within the South African construction industry. This study adopted a quantitative approach, and random sampling techniques were used to collect the data through questionnaires that were distributed amongst the construction professionals found within the study area. A total of one hundred and fifty (150) questionnaires were sent out and fifty-seven (57) responses were received. The analysis of the data collected was conducted using SPSS V 24, while statistically tested using mean item score, frequency distribution, and standard deviation. The findings revealed the poor performance of the construction industry in different projects due to challenges of political risks. Furthermore, political risks have discouraged construction investors from investing in construction projects because projects are prone to cost overruns, and time overruns because of these risks. Improved construction regulations and awareness of the political risks within construction project is strongly advised for high or good performance of construction projects with little or no political risks.