Zhang, X (2005) Concessionaire's financial capability in developing build-operate-transfer type infrastructure projects. Journal of Construction Engineering and Management, 131(10), pp. 1054-1064. ISSN 0733-9364
Abstract
The concessionaire of a build-operate-transfer (BOT) type infrastructure project undertakes many responsibilities, and consequently, assumes a broad scope of risks and potential financial consequences. In addition, appropriate financial engineering skills are required in nonrecourse or limited-recourse financing, which is usually used in BOT-type projects. Therefore, strong financial capability of the concessionaire is an important prerequisite to the successful development of a BOT-type project. A common set of 35 financial criteria has been identified through a systematic research approach, and their relative significances determined based on worldwide expert opinions solicited by a structured questionnaire survey. Statistical analyses of the responses to the survey conclude that (1) the public, private, and academic sectors consider financial criteria rather similarly in the evaluation of the concessionaire's financial capability, and there is no significant statistical difference in the rating of the significances of the 35 financial criteria across these sectors; (2) almost all of the 35 financial criteria are important in measuring the concessionaire's financial capability; and (3) the 35 financial criteria can be grouped to measure the concessionaire's financial capability in four dimensions: "strong financial engineering techniques," "advantageous finance sources and low service costs," "sound capital structure and requirement of low-level return to investments," and "strong risk management capability." Outputs of this research facilitate the private sector in assessing their financial capability and making corresponding improvements to increase their financial competitiveness, and the public sector in evaluating potential concessionaires' financial capability for BOT projects in general.
| Item Type: | Article |
|---|---|
| Uncontrolled Keywords: | build/operate/transfer; financial management; infrastructure; project management; risk management |
| Index terms: | risk management, build-operate-transfer, competitiveness, dimension, infrastructure project, project management, capital structure, financial management, private sector, public sector, statistical analysis, questionnaire, financing, concessionaire, survey |
| Subjects: | data science, contractual arrangements, economic analysis, health monitoring assessment and metrics, data collection methods, risk assessment, contract type, administrative law, industry analysis, infrastructure and transport systems, market analysis, project management theory and practice |
| Topics: | Legal Issues, Health and Safety, Business Strategy, Engineering Principles, Research Practice, Project Management, Risk Management, Procurement |
| Descriptive scope: | 4 PCEA |
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