Selected issues in business and contractual relationships in private construction projects in Canada/China deals

The thesis provides an exploratory investigation into business and contractual relationships within the construction industry in China. The scope of the thesis is limited to private construction and excludes large scale government contracts or contracts that involve financing by the World Bank.

The research is qualitative in nature and has been based on interviews and surveys conducted with managers, engineers and contractors within the construction industry in selected provinces in China. The responses obtained provided a basis for understanding how business relationships can be initiated and maintained within the industry. The research also provides an understanding of the contractual framework including laws, governance, enforcement and dispute resolution.

The findings of the research indicate that business relationships are vital for Canadian firms venturing into the Chinese construction market. The relationships are based on trust and have to be developed over time. A model for building and sustaining business relationships within the construction industry has been presented. In the contractual framework, different factors are important at different stages of the framework, but ultimately cost and the willingness to negotiate beyond the contract become dominant factors. Included in the thesis are suggested guidelines for Canadian corporations contemplating participation in the Chinese construction market. A model for this participation has also been presented.