Role and Impact of Business to Government (B2G) Guanxi in Bidding of Infrastructure Projects: A Case in China

Abstract

Infrastructure projects in China are dominated by government, its entire bidding and tendering process is subject to administrative control, and B2G (Business to government) guanxi has important implications for bidding and tendering activities. This paper investigated professional staff working in bidding and tendering activities of infrastructure projects through guanxi attitude, guanxi value and its roles. It is revealed that the bidding and tendering activities would be very convenient if having B2G guanxi. What’s more, the bidders could avoid bidding and tendering risks through B2G guanxi. However, the bidders need spend a lot of time, money and energy establishing and maintaining B2G relationship. Establishing B2G guanxi could through family, friend and intermediary three ways, and the bidders would prefer establishing their B2G guanxi among business activities. B2G guanxi has an impact on the bidding and tendering results and the will of bidding and tendering, in each type of infrastructure project bidding and tendering, B2G guanxi is needed. If having B2G guanxi with senior officials, it would further contribute to the successful bidder. Whereas, B2G guanxi violates the principles of fairness and transparency, at last, this paper propose how to foster the competitiveness of construction enterprises and culturing professional ethics to ensure B2G guanxi in a healthy way.