Financial Evaluation Of PJ Wastewater Treatment Construction Project Financed By World Bank And Enlightenment

Based on the estimation of financial benefit and cost and preparation of financial auxiliary statements, project financial evaluation is to envestigate and analyse project profitability, solvency and financial viability, and to judge the financial feasibility of the project through preparation of financial statements and calculation of financial indicators of the project. Project financial evaluation is one of core contents of the project feasibility study. The conclusion of financial evaluation is one of the most important basis of the project investment decision made by the World Bank. The financial evaluation on the world bank financed wastewater treatment project has the typical, comprehensive, representative characteristics of the world bank loan project financial evaluation, with reference to the financial evaluation of domestic urban construction and environmental protection projects. Based on this background, the world bank loan of PJ wastewater treatment construction project is selected as the research object. This paper analyses the gap between the national and international project financial evaluation method and summarizes that the project financial evaluation made by the World Bank focuses not only on the financial evaluation of the project itself, but also more on the financial evaluation of the project’s internal and external financial environment, in order to promote the continuous improvement of the national similar project financial evaluation.This paper introduces the history and research findings of financial evaluation on national and international construction projects, as well as its theory and methodology. The paper i) describes the background of PJ wastewater treatment construction project financed by World Bank; ii) investigates financial evaluation method of the Project financed by the World Bank, which covers institutional capability evaluation, financial management capability assessment and sustainability analysis of project implementing agency, project investment return analysis, and local fiscal capacity and household affordability analysis etc. Through comparision between national and World Bank financial evaluation, five enlightenment are drawn on financial evaluation for wastewater treatment constructon projects financed by World Bank, which are:ⅰ) more attentions on capacity building and institutional strengthening on project implementing agencies; ⅱ) more attentions on capability building on financial management of project implementing agencies; ⅲ) more attention on sustainable operation of the project implementing agencies; ⅳ) ensuring the counterpart fund supplied by local government and ⅴ) more attention on the analysis of household affordability. Ideas and methods are provided for improvement on financial evaluation for the national feasibility study report, in order to promote the evaluation level in feasibility study phase of the project.