An Assessment of the Impact of Jurisdiction Risks On The Success Of Projects Done By Foreign Construction Contractors In Uganda

Abstract

Foreign construction countries are known for their diversity in carrying out several construction projects across different countries outside their own. This enables them to tap into the benefits and profits of those countries and to generate income. However, developing countries such as Uganda are characterised by several uncertainties such as inflation, unfavourable climate, poor infrastructure, cultural differences, political and social instabilities. These affect the success of the foreign contractors’ projects by causing cost overruns, delays, low quality of works and other negative effects. This requires the foreign construction contractors to research into the uncertainties involved with working in the Ugandan construction industry and devise strategies for adapting to the prevailing conditions. This research was concerned with the assessment of the the impact of jurisdiction risks on the success of projects done by foreign construction contractors in Uganda. The study identified the risks faced by foreign construction contractors operating in Uganda, their causes and impacts. The most common causes of jurisdiction risks found included Political, Cultural, Legal, Financial, Economic Social factors such as riots. A critical review of the literature on jurisdiction risks is structured under chapter two where an in depth study on the causes and impacts of jurisdiction risks as well as the risk management process was done. The research methodology included a structured questionnaire administered to foreign construction contractors in Kampala that was used for gathering data and the Microsoft excel used in the analysis of the data as shown in Chapter three. In addition the study provides an overview of the risk identification techniques and examined the most effective risk responses adopted by the foreign construction contractors when managing jurisdiction risks as shown in chapter four while discussion of the findings and recommendations on how to mitigate and control jurisdiction risks were made in chapter five.

It is recommended that foreign construction contractors should be more conversant with the jurisdiction risks through research, conferences and partnering with local subcontractors so as to broaden their understanding of the Ugandan construction industry. The government of Uganda should also minimise bureaucracy and relax strict laws in order to encourage foreign construction activity and development.