The Evolution of Political Risk in Chinese Overseas Investment Projects: A Case Study Based on the Perspective of Legitimacy

Abstract

Abstract:

Political risk is one of the critical challenges for Chinese overseas investment projects. This paper, based on the perspective of legitimacy, attempts to explore the evolution of political risk of Letpadaung copper mining. The results show that:(1) The evolution of political risk of Chinese overseas investment projects has experienced three stages:the formation of irrational negative attitude, the diffusion of irrationality political confrontation events and behaviors, and the cessation of political confrontation events and behaviors. (2) the legitimacy plays an important role in the evolution process of political risk. The shortage of cognitive legitimacy promotes the accumulation of political risk energy, the crisis of regulation legitimacy, normative legitimacy and cognitive legitimacy accelerates the release of political risk energy, and the reconstruction of regulation, norm and cognitive legitimacy adjusts the stability of political risk energy. The main contribution of this study is that it develops the process model of the evolution of political risk based on the perspective of legitimacy and the conclusion of this paper has a certain enlightenment on the "going global" enterprises under the background of "One Belt and Road".

Key words: Chinese overseas investment project, political risk, legitimacy, case study

He Jinhua, Tian Zhilong. The Evolution of Political Risk in Chinese Overseas Investment Projects: A Case Study Based on the Perspective of Legitimacy[J]. , 2019, 31(6): 277-288.

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