Research On The Investment And Construction Contract Of BT Mode In China

BT (Build-Transfer) mode is now flourishing quietly in China, and it relieves the problem of lacking fiancial funds for the local government. However, there are some problems in practice, such as indistinct of property right, unreasonable risk allocation and difficulty rational appraisal of ROA and so on due to legistation delay. These problems root in the key elements of the central contract under BT mode, namely investment and construction contract of BT mode. The paper explores these key elements. The main study contents are as follows:1. Discussing the formation mechanism of successful cooperation about BT mode. It expounds the common goals between the government and the private sector in BT project based on the cooperation game theory, then applies the Rubinstein geme model to analyze the negotiation system between BT initiator (local government or local governmental branch) and BT investor and constractor (the private sector).2. Analyzing the application scope of BT mode and selection of contract type. It explains the project types that fit for BT mode using public good theory, the selling probability of infrastructure theory and infrastructure distinction theory, and determines the proper scale of BT project by application of transaction cost theory. Moreove, it anlyzes the type of investment and construction contract of BT mode in the light of Turner and Simister Model based on transaction cost theory.3. Researching on the key problems of investment and construction contract of BT mode, including the allocation of rights, risks and benifits.Firstly, the property rights in the investment and construction contract of BT mode is divided into special rights and residual rights applying the property rights theory, and the these rights are allocated between BT initiator and BT investor and constrator. Referring to the theory of firm's ownership, the ownership of BT project is arranged. At the same time, the guarantee mechanism of the contractral partys'rights and interests especially emphasizes on analyzing engineering guarantee using dynamic game theory.Secondly, it establishes the risk allocation system model using internationl common pratice principle, and identifies the risk fators of BT project by application of literal summary and risk break-out system, and then builds the risk allocation matrix on the base of qualitative analysis.Thirdly, in the light of the basic composition of engineering cost in China, it designs the purchasing scheme of BT project using technology and economics theory, and set forth the estimation methods of ROA, namaly estimates the ROA of investor and contrator in BT projects through single-factor APT model and deformed income discounted law.4. Verifying the research outcome through a real example.