This paper investigates the international construction joint
venture (ICJV) risks in Thailand by focusing on the
formation phase, in which each contractor has to decide
whether to join other contractors to work together in such
construction project. In this phase, there will be negotiations
and some document preparations among the partners to
develop their cooperation model, which then leads to reach
their agreement and sign the JV agreement in time. Because
the JV agreement, that is an official contract between
partners, is always required by the project owner in the bid
submission process. In Thailand, the duration between the
call for bid date and the bid submission date for the
infrastructure projects is generally 45 days. The short
duration may be a critical constraint for some unexperienced
contractors to complete their JV agreement before the date
line. To reduce any risk events, which affects the operation
objective for this phase, is that the partners can reach the JV
agreement on the proportion of investment, the proportion of
profit allocation, their responsibility and liability sharing,
and delay of the JV agreement preparation.
After reviewing literature and conducting a pilot survey,
20 ICJV risks associated with the formation of an ICJV were
identified and analysed by a group of experts, consisting of
34 respondents. The risk parameters (CSQ and LHH) for
each risk were evaluated by using the Delphi technique,
which was applied to questionnaire surveys and in-depth
interviews. To further investigate the relation between the
risks and the two ICJV organization structures (CG-JV and
SG-JV), the respondents were separated into two groups and
the results were analysed with the nonparametric methods
and the hypothesis was tested.
The results showed the ranking of all the ICJV risks based
on their consequence (CSQ), likelihood of occurrence (LLH),
and level of risk (LOR). The risks were then plotted in a risk
matrix and the priority of risk treatment was proposed. The
risk response alternatives for some critical risk were
discussed. The results also showed that the ICJVs with
different organization structures entail different risk
parameters. Among the 20 ICJV risks, there were five ICJV
risks which their CSQ or the LLH for both organization
structures were different with statistical significance.