Risk Assessment of Photovoltaic Investment in Belt and Road African Countries Based on ANP-CRITIC-TOPSIS Method

Fenyu Zeng
College of Economics and Management, Shanghai University of Electric Power, Shanghai 201306
Shuang Wang
College of Economics and Management, Shanghai University of Electric Power, Shanghai 201306

Abstract:

The emphasis on high-quality development under the 'Belt and Road' initiative has opened substantial opportunities for Chinese enterprises to invest in overseas photovoltaic (PV) power generation. As African nations actively pursue clean energy solutions, Chinese companies are increasingly venturing into the photovoltaic project market across the continent. However, these investments are accompanied by significant risks, including political instability and exchange rate fluctuations in African countries. To assess the photovoltaic investment risks in African countries along the "Belt and Road," this study examines 27 nations, including Egypt, Kenya, Zambia, Ghana, and South Africa. We have developed a comprehensive risk assessment framework for photovoltaic power generation investments, encompassing six critical dimensions: political, economic, social, financing, resource and environmental, and diplomatic risks. Utilizing the Analytic Network Process (ANP) and Criteria Importance Through Intercriteria Correlation (CRITIC) methods, we determined the relative weights of these risk indicators. Subsequently, the Technique for Order Preference by Similarity to Ideal Solution (TOPSIS) method was applied to rank the investment risks of these countries, providing a systematic approach to evaluate and prioritize investment decisions in the region. The findings reveal that political risk significantly influences investment decisions in photovoltaic power generation projects, whereas resource and environmental risks have a comparatively minor impact. The risk assessment across various regions indicates that Northern and Southern Africa exhibit relatively lower investment risks. Among these, South Africa in Southern Africa emerges as the least risky destination for investment. Conversely, Cameroon, located in Central Africa, is identified as the region with the highest investment risk.