The Risks of Construction PPP Projects in Palestine: A Combined MICMAC-FISM Examination

The Risks of Construction PPP Projects in Palestine: A Combined MICMAC-FISM Examination

Kawther Mousa, Zenglian Zhang, Eli Sumarliah
Copyright: © 2022 |Pages: 24
DOI: 10.4018/IJISSS.296276
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Abstract

Many developing nations, such as Palestine, implemented PPP (public-private partnership) to fulfill the increasing needs for public services and facilities. Nonetheless, PPP projects have numerous risks which influence each other and can cause project failures. Unfortunately, current studies related to the PPP risk association have not provided adequate details. This paper tries to fill the literature gap by proposing a practical approach in analyzing the relationship among PPP risks. First, the research identifies risk for PPP projects in the Palestinian construction industry by integrating the interviews and literature review. Next, this study reflects the associations among the risks and reveals the failure instruments of PPP projects using FISM (fuzzy interpretative structural modeling). Besides, this paper uses MICMAC (matrix impact cross-reference multiplication applied to a classification) and FISM method to discover and finalized the 19 crucial risk elements. The MICMAC-FISM approach reckons the fuzzy of the PPP risk association and enhances upon previously published works.
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Introduction

A public-private partnership (PPP) signifies an association linking private investors and government to deliver public services, goods, and infrastructural projects (Ma et al., 2018). PPP has enticed extensive consideration from the public sector and has been implemented in many nations (Węgrzyn, 2016; Wojewnik-Filipkowska and Trojanowski, 2019), as it can offer excellent outcomes in the reduced budget and period (Yuan et al., 2012).

Nonetheless, PPP is typified by complex technologies, long contract concession periods, and extensive investments, which cause numerous latent risk issues in the adoption procedure, which can also cause project failures (Osei-Kyei and Chan, 2015). Since 1990 World Bank has announced 279 “canceled” PPP projects (Jiang et al., 2019). Moreover, since the 2007–2008 international monetary slump, the government of developing countries has become more concerned about PPP as a method for the regional government to relocate their debts (Osei-Kyei and Chan, 2015). Nevertheless, the development of PPP in developing countries is slower than in developed countries (Xu et al., 2010). Besides, several PPP projects are ineffective in developing countries (Shen et al., 2006), including Palestine, which is also reckoned as a developing nation by United Nations and World Bank (Abueisheha et al., 2020). In the construction industry, PPP projects’ ineffectiveness happens mostly because this industry is responsible for one of the highest work-related mortalities, illnesses, and injuries worldwide (Manu, 2019). For example, in 2018, The Ministry of Labour in Palestine informed 2,948 injuries and 17 fatalities in the construction sector in the West Bank area only (Abueisheha et al., 2020). A prior study reported other significant risks related to a construction project in Palestine, i.e., financial failure, working in dangerous areas, and border closure (Enshassi et al., 2008).

Moreover, Palestine’s strategic location has made this country a state of conflict. Unlike other countries, Palestine possesses a developing market condition explained by some characteristics, e.g., the intrinsic vulnerability caused by the occupation of Israel, such as border closures (Mujahed et al., 2021; Enshassi et al., 2008) and the bombing of Palestinian district of Gaza Strip (UNOSAT, 2021). Due to the occupation, Palestine’s economy has traversed tremendously negative situations in the last seventy years (Mujahed et al., 2021). Palestinians were expelled and financially relegated since most land, properties, and treasures were taken by Israel (Mujahed et al., 2021). Regardless of this nationwide suffering, Palestinians have shown their unique political, cultural, economic, and social vitality, which has empowered them to continue their fight for democracy and freedom; they have also built their wanted economic vision (Mujahed et al., 2021). Despite the long-term war, the construction projects continue in Palestine. However, the risk of unforeseeable circumstances due to war exists and can lead to the failures of PPP construction projects in Palestine. For example, UNOSAT (2021) reports that after the Israeli bombing of the Gaza Strip in May 2021, a satellite imagery examination found more than 486 destroyed buildings, including 43 schools and 130 health centers.

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