Diplomarbeiten


(Fachbereiche): Betriebswirtschaft - Branche Industrie / Produktion Bauindustrie

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Titel BOT-Projects in Asia
Untertitel Impact Study of an Efficient Risk Management during Build-Operate-Transfer Projects in the Infrastructure Sector
AutorIn
Seiten 105 Seiten
Hochschule Fachhochschule Nürtingen Deutschland
Art der Arbeit Diplomarbeit
Abgabe 2006
Note 1,5
Preis 38,00 EUR (inkl. MwSt.)
Bestellnummer 91009738
Sprache Englisch
Medien Papier / CD
Inhaltsangabe
Abstract:

The rapidly developing economies in Asia are undergoing unprecedented growth. This explosive development has placed incomparable demands on the existing infrastructure in many countries. Governments struggle with the challenge of providing modern, efficient, and affordable infrastructure services for their people; finding it difficult to finance what are often multimillion dollar projects on their own. Involving the private sector in the financing and operation of infrastructure promises several benefits for both parties.

With a share of over eleven percent in German foreign trade, exports to Asia are - in terms of volume - now two percent higher than those to the USA. Many German companies have taken on public private partnerships as a form of cooperation and thus play a part in the sustainable development of the Asian economies. To date the most common sub-type of private participation in infrastructure is the BOT (Build-Operate-Transfer) model, where a project company finances and constructs new infrastructure and operates that infrastructure over a long-term period, before it is transferred back to the government. But despite the long history of projects of this type, only a few are very successful and usually mean more costs than income to the companies.

Eurotrain, a joint venture between rail giants Alstom and Siemens, proved in May 1998 it was ready to build Taiwan's US$ 14 billion high-speed rail (BOT) project, with a successful test-run of its integrated train system in Germany. The only problem was that after at least a two-year effort, the Taiwan High Speed Rail Corporation (THSRC) suddenly decided to give the core contracts to the Japanese Shinkansen Consortium. THSRC has yet to explain why Eurotrain was not given a chance to match Shinkansen's offer. De facto ambassadors from Germany, France and even the CEO's of the companies met with THSRC's chairwoman Nita Ing, who failed to provide any explanation whatsoever for this change of plan.

BOT projects are extensive in nature, with the companies therefore always finding themselves in international competition and/or having to forge global partnerships to get the project done. They have to be aware of every single potential local and global risk which could threaten the whole project; not only to ensure that the project is won, but also to successfully complete it.

For huge companies, there is often the difficulty that risks are misjudged, meaning that projects are either cancelled completely or, in case of overestimated risks, the bidding price is much higher than the competitors, which ultimately both lead to a loss of image and references.

On the other hand, there are more than enough examples of risks being severely underestimated, with the project turning out to be absolutely unprofitable and companies often have to face long and cost-intensive legal disputes. This turns especially fatal when construction companies like Siemens are also under the sponsors/investors of the project.

Within most companies, there are clearly differences in the perception of the risks. The goal of this thesis is to provide a better understanding of the most important risks during Build-Operate-Transfer Projects in Asia.

Inhaltsverzeichnis:

Acknowledgment I
Table of Contents II
Table of Acronyms and Abbreviations V
Table of Figures VIII
1. Introduction 1
1.1 Motivation of the Thesis 1
1.2 Methodology and Containment of the Study 3
2. Private Participation in Infrastructure 4
2.1 Private Participation in Asia 6
2.2 Public Infrastructure 7
2.2.1 Transport Sector in Asia 10
2.2.2 Railways Segment in Asia 11
2.3 Forms of Private Participation 13
3. BOT Projects 18
3.1 General Definitions of BOT 18
3.2 Parties Involved in a BOT Project 20
3.2.1 Government Agency 20
3.2.2 Sponsors 22
3.2.3 Lenders 22
3.2.4 Multilateral, Bilateral and Export Credit Agencies 23
3.2.5 Project Company 26
3.2.6 Construction Contractor 27
3.2.7 Operation and Maintenance Contractor 28
3.2.8 Offtake Purchaser 29
3.2.9 Input Supplier 29
3.3 The Contractual Framework 30
3.3.1 Concession Agreement 31
3.3.2 Shareholders' Agreement 31
3.3.3 Lending agreements 32
3.3.4 Construction Contract 33
3.3.5 Operation and Maintenance Agreement 34
3.3.6 Offtake Purchase Agreement 34
3.3.7 Input Supply Agreement 35
3.4 Phases of a BOT Project 36
4. Tendering Procedures 38
4.1 One-Stage Bidding Processes 39
4.2 Two-Stage Bidding Processes 40
4.3 Bid approaches 40
4.4 Issues Specific to Tender Procedures 41
4.4.1 Bid Bonds 41
4.4.2 Confidentiality of Intellectual Property 42
4.4.3 Competition during the Bid 42
4.4.4 Lack of Information 43
5. Project Finance 45
5.1 Typical Characteristics and Features 46
5.1.1 Cash Flow Related Lending 46
5.1.2 Risk Sharing 47
5.1.3 Limitation of Liability 47
5.1.4 Off Balance Sheet Financing 48
5.2 Financing Instruments 49
5.2.1 Project Finance-Based Debt 49
5.2.1.1 Commercial Bank Loan 50
5.2.1.2 Bond Finance 51
5.2.1.3 Mezzanine Finance 55
5.2.2 Equity 55
5.2.3 Other Sources 56
5.2.3.1 Value Capture 56
5.2.3.2 Project Leasing 57
5.3 Finance Structure 57
6. Risk Management 59
6.1 Risk Identification 60
6.1.1 Technology Risk 62
6.1.2 Completion Risk 62
6.1.3 Sales Risk 63
6.1.4 Financing Risks 64
6.1.5 Input Supply Risk 66
6.1.6 Operational and Management Risks 67
6.1.7 Political Risk 67
6.1.8 Legal Risks 69
6.1.9 Environmental Risk 70
6.1.10 Force-Majeure Risks 71
6.2 Risk Quantification 72
6.2.1 Static Risk Quantification Techniques 72
6.2.2 Dynamic Risk Quantification Techniques 74
6.3 Risk Reduction 76
6.4 Risk Spreading 77
6.5 Further Risk Allocation 79
6.5.1 Guarantees 79
6.5.2 Liquidated Damages and Indemnity Obligations 81
6.5.3 Insurances 81
6.5.4 Derivative Instruments 83
6.6 Risk Management Process 85
6.7 Risk Efficiency 86
7. Summary 87
8. Conclusion 88
Table of Enclosures 90
Enclosures 91
List of References 92
Declaration of Non-Plagiarism / Ehrenwörtliche Erklärung 98

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