The Contractor’s Invest Risk Management Of Urban Infrastructure Projects Under BT Model

Innovating the investment and financing model for urban infrastructure is seenas an important means to improve the construction of urban infrastructure andaccomplish the process of urbanization. The local governments all triedconsidering the fact that the BT model can help the government to raise constructionfunds and relieve financial pressure during the construction period, and theconsiderable profit tends to attract the construction enterprises who have solidfinancial strength and strong project management ability. But under BT model, theproject contractors may encounter all kinds of risks resulting in damage to its owninterests in the process of pre-project financing, cost control during implementationand project buy back after completion. Therefore, this thesis studies risk assessmentand management in the city infrastructure BT project from the perspective of projectcontractors.First, reviewing the current research focus and practice of BT constructionmodel. And then by summarizing the theoretical basis and operational characteristicsof the BT model and having a deep analysis of interest relationships, operationprocedures and operation model among each participant in BT model, we provide abasis for identification of risk factors in BT financing construction projects.Second, from perspective of the general project contractor, we have acomprehensive recognition of common risk factors in BT project and classify therisk factors into external risks (which are mainly political risk, legal risk, economicrisk and environment risk), and internal risks (which include cost control risk,quality control risk and risk of the suitability of construction cycle technicalbarriers). Third, relying on the case of the BT project of the scenery along northernembankment of Zhengshui river in Hengyang, we build investment risk analysismodels for BT project contractor based on AHP and calculate the assessment resultsby adding the actual data into the models by using AHP software.Finally, the thesis formulates the risk prevention measures from the projectcontractor perspective based on the results of case analysis. The main measures toexternal risks include strengthen government credit investigation, assess theprofit-sacrifice commitment made by the governments, investigate and evaluate theeconomical efficiency and suitability of the project, choose the appropriategovernment guarantee mode, purchase commercial insurance and rationalize diversified portfolio. The main measures to internal risks include: rationalize thecorporate governance structure, strengthen the financial oriented management,adhere to the principle of three control, pay attention to the external environmentand set up a competent project manager department to achie ve a comprehensiveperformance better and faster.This study researches on investment and financing risk management of cityinfrastructure based on BT model from the perspective of general contractingenterprise and identifies potential risks during the project timely through theestablishment of an effective system of risk identification and assessment, thus canhelp the BT general contractor enhance ability to cope with t investment risks. At thesame time, this study provides more objective and accurate basis fordecision-making for both the government and investors.