Legal risk assessment framework for international PPP projects based on metanetwork

Abstract

The number of international public-private partnership (PPP) projects has gradually increased with global infrastructure interconnections. These international projects incorporate high risks, and legal risk is one of the most serious risks. International PPP projects have long life cycles, and the specific legal risks in each stage may be different and related to each other. However, previous risk assessment methods have ignored the correlation and variation of legal risk factors in different stages, which have limited applications in risk management practice. Therefore, this paper establishes a legal risk analysis framework for international PPP projects based on metanetwork analysis (MNA) to evaluate the legal risks of the entire project life cycle in stages and calculate the correlations between different risk factors. Then the framework was applied to a Peruvian international PPP project. The key legal risk factors in each stage were identified, the main risk-spreading paths were depicted, and the influence and independence of risk factors were calculated. This framework is expected to provide guidance for foreign private contractors of international PPP projects to conduct fine management of legal risks.