Public-Private Partnership in Infrastructure Financing

Ing. Artem Shikhov

Master's thesis

Abstract:

Public-Private Partnership projects have recently become a great reason for discussions between experts from all over the world. Many countries established such kind of procurement and achieved enviable results creating roads, ports and other infrastructure objects. However, these business processes undergo numerous critiques as well as support from society. The purpose of this study is to investigate the PPP concept, stress out financing issues and identify crucial risks related to implementation of PPP projects, through analyzing of experience of developing countries. In the first part, theoretical aspects of PPP project development are presented. It defines the basic elements of PPP business model and phases of procurement, which provide general understanding of the concept. The part illustrates main participants involved in PPP projects, explains the typical forms of public and private agreement. Furthermore, there are displayed financing schemes involved in the public-private partnership. Practical part describes infrastructure financing in developing countries focusing on the example of China. The thesis then touches upon empirical case study of Laibin B Power Plant Project and outlines the success factors of PPP project with help of SWOT analysis and study of risks.

Abstract:

Public-Private Partnership projects have recently become a great reason for discussions between experts from all over the world. Many countries established such kind of procurement and achieved enviable results creating roads, ports and other infrastructure objects. However, these business processes undergo numerous critiques as well as support from society. The purpose of this study is to investigate the PPP concept, stress out financing issues and identify crucial risks related to implementation of PPP projects, through analyzing of experience of developing countries. In the first part, theoretical aspects of PPP project development are presented. It defines the basic elements of PPP business model and phases of procurement, which provide general understanding of the concept. The part illustrates main participants involved in PPP projects, explains the typical forms of public and private agreement. Furthermore, there are displayed financing schemes involved in the public-private partnership. Practical part describes infrastructure financing in developing countries focusing on the example of China. The thesis then touches upon empirical case study of Laibin B Power Plant Project and outlines the success factors of PPP project with help of SWOT analysis and study of risks.

Keywords

Project, PPP, infrastructure, financing, investment, risks, SWOT, analysis, China, Laibin

Language used: English

Date on which the thesis was submitted / produced: 11. 5. 2015

Thesis defence

• Date of defence: 26. 6. 2015
• Supervisor: Ing. Marie Těhlová
• Reader: MBA Jaromír Stemberg

University of Finance and Administration

Master programme / field:
Economics and Management / Business Management and Corporate Finance