Role of Financial Risks in BOT Megatransportation Projects in Developing Countries

Aladağ, Hande; Işık, Zeynep

doi:10.1061/(asce)me.1943-5479.0000527

Cited by 43 publications

(40 citation statements)

References 46 publications

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“…Currently, financial issues in traditional construction projects have been adequately addressed [101][102][103][104]. Various financial issues in traditional construction project, such as inflation and fluctuation, shortages of investment capital, poor credit ability, interest rate, liquidity, currency exchange restriction, have been comprehensively investigated [105][106][107][108]. However, similar research efforts have not been made in sustainable construction projects.…”

Section: Identification Of Financial Issues In Sustainable Constructimentioning

confidence: 99%

A Global Review of Sustainable Construction Project Financing: Policies, Practices, and Research Efforts

2017

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Despite the increasing investment in sustainable development over the past decade, a systematic review of sustainable construction project financing is lacking. The objectives of this paper are to conduct a systematic review to examine the policies, practices, and research efforts in the area of sustainable construction project financing, and to explore the potential opportunities for the future research. To achieve these goals, this paper first reviewed the sustainable construction project financing practices implemented by four representative developed economies including the United Kingdom, the United States, Singapore, and Australia. Then, this paper reviewed the efforts and initiatives launched by three international organizations including the United Nations, the Organization for Economic Co-operation and Development, and International Finance Corporation. After that, this paper reviewed the research efforts of sustainable construction project financing published in peer-review journals and books. This paper identified four major research themes within this area, which are the review of financial stakeholders and market of sustainable construction, benefits and barriers to sustainable construction project financing, financial vehicles for sustainable construction projects, innovative models and mechanisms for sustainable construction project financing. Additionally, this paper revealed five directions for the future research of sustainable construction project financing, which are the identification of financial issues in sustainable construction projects, the investigation of financial vehicles for sustainable construction projects in terms of their strengths, limitations, and performances, the examination of critical drivers for implementing sustainable construction project financing, the development of a knowledge-based decision support system for implementing sustainable construction financing, and the development of best practices for implementing sustainable construction project financing. This paper contributes to the body of knowledge by reviewing existing policies, practices, and research efforts in the area of sustainable construction project financing. Meanwhile, the findings from this paper benefit the industry as well, because they are able to provide the practitioners with a holistic view of sustainable construction project financing, thereby enhancing their knowledge and skills in this regard.

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Section: Identification Of Financial Issues In Sustainable Constructimentioning

confidence: 99%

A Global Review of Sustainable Construction Project Financing: Policies, Practices, and Research Efforts

2017

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“…Xenidis and Angelides (2005) stated that currency exchange, cost of capital, inflation rate are considered as the major financial risk which overrun the project cost. In other study heavy loans of the company was stated to reduce the company profitability (Aladağ & Işik, 2017). Additionally, cost overrun was the cause of financial loss, due to this loss, clients and contractors can suffer, significantly (Patah & de Carvalho, 2007).…”

Section: Financial Risk and Project Successmentioning

confidence: 98%

Influence of risk factors on construction firm project success in Pakistan

Imran¹,

Khaliq²,

Hye³

et al. 2019

10.5267/j.dsl

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The main objective of the present study is to investigate the risk factors influencing on construction firm's project success in Pakistan. The study uses the partial least square structural equation modelling technique to analyse the data collected from 61 construction firms. The study finds positive impacts of design risk, financial risk, technical risk and labour risk on the success of the project. Alternatively, the current study finds no relationship between external risk factors and the success of the project. Furthermore, the current study suggests government and construction firms to consider the risk factors during the decision making for project implementation.. 2018 by the authors; licensee Growing Science, Canada ©

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“…According to these, the stages can further be divided into six basic phases comprising the preliminary qualification evaluation phase, tendering phase, concession award phase, construction phase, operation phase, and transfer phase. Among these phases, only the construction phase and the operation phase are included in the concession period [33]. which includes unit generating capacity, the volatility of electricity demand, policy incentives (i.e., initial cost subsidy and the feed-in tariffs mechanism), electricity price, unit investment cost, and land-use rent fee of the BOT project?…”

Section: The Concept Definition and Literature Reviewmentioning

confidence: 99%

“…According to these, the stages can further be divided into six basic phases comprising the preliminary qualification evaluation phase, tendering phase, concession award phase, construction phase, operation phase, and transfer phase. Among these phases, only the construction phase and the operation phase are included in the concession period [33]. Previously, BOT power projects have drawn attention from both academics and industry practitioners, which is well-evidenced in the literature.…”

Section: The Concept Definition and Literature Reviewmentioning

confidence: 99%

“…ϕ T c , Eq e t = max φ p,t Eq e t + φ g,t Eq e t (33) where φ p,t Eq e t is the combined project values of the two major stakeholders, which considers the value of the option to defer, φ p,t Eq e t denotes the project value of the private sector considering the option value to defer, and φ g,t Eq e t denotes the project value of the government, which takes the option value of the government to defer into account.…”

Section: Establish the Option-cooperative Game Model For The Optimal mentioning

confidence: 99%

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The Determination of Concession Period for Build-Operate-Transfer Solar Photovoltaic Power Project under Policy Incentives: A Case Study of China

Chen

2019

Energies

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Since the concession period is one of the most crucial variables influencing the success of a photovoltaic (PV) power project under build-operate-transfer (BOT) mode, this paper presents a real option game model—which integrates the real option and cooperative game theory—to determine the optimal concession period of the BOT solar PV power project under policy incentives by considering the value of the option to defer. In the proposed model, an effective interval of concession period for the BOT project was identified by using a real option, and the equilibrium value of the concession period was obtained by applying classical optimization theory. To evaluate our model, we empirically determined the optimal concession period for the BOT solar PV power project in China, and a sensitivity analysis was conducted to demonstrate how relevant influential factors, which are presented in the model, affect the equilibrium value of the concession period and its effective interval. The results indicate that the current investment environment in China could successfully implement the BOT solar PV power project under policy incentives, including initial cost subsidy and the feed-in tariffs mechanism. While the high volatility of electricity demand, investment cost, and land-use rent fee can lead the failure of the BOT solar PV project implementation, promoting the technological development of PV power generation, maintaining the market stability, and increasing the policy incentives can help the BOT power project to be arranged with an optimal concession period. In addition, the feed-in tariffs mechanism is more helpful than the initial cost subsidy for winning the BOT contract.

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Role of Financial Risks in BOT Megatransportation Projects in Developing Countries

Cited by 43 publications

References 46 publications

A Global Review of Sustainable Construction Project Financing: Policies, Practices, and Research Efforts

A Global Review of Sustainable Construction Project Financing: Policies, Practices, and Research Efforts

Influence of risk factors on construction firm project success in Pakistan

The Determination of Concession Period for Build-Operate-Transfer Solar Photovoltaic Power Project under Policy Incentives: A Case Study of China

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