The Analysis Of Non-system Risk Effect On Concession Period In BOT Projects

The limited state investment can not meet China's infrastructure development needs in the infrastructure construction area because of huge requirements, high investment and long construction cycle. In order to rapidly develop China's economy, expand the infrastructure investment sources and enrich its investors, BOT projects, as a new financing model, have more extensive application in China's infrastructure projects construction. However, there are still many issues to be considered in the practical operation of BOT projects.The concession period determination is one of most important contents in the concession agreement, the determination of a reasonable concession period is the key to ensure the interests of both investors and the government. According to the traditional theory of project financing, the proceeds profits of the project depends primarily on a series of uncertainties, the impact on the entire industry's economic situation and political factors and other factors could be avoided in some projects. Under normal circumstances, investors are more concerned about non-system risk effect on concession period when venture capital investment decisions are made, so the research of non-system risk effect on concession period in BOT projects have practical meanings in this paper.In this paper, we have quite thorough research of Non-system risk effect on the concession period limited. At the same time quantitative analyses are made to the impact of the risk and consideration to build a non-systemic risk factor of the concession period under the formula. the theory and methods are applied in the case analysis, the calculated length of the concession period matches well with that in the real situation.