Risk Management Analysis Of PPP Model Applied In Sewage Treatment Industry

With the concept of green development becoming the theme of current development,and the contradiction between supply and demand of water resources is gradually deepening,which puts forward higher requirements for water enterprises,such as improving their innovation ability,learning from advanced western experience,fulfilling their social responsibilities,etc.The development of urbanization process is more and more stringent to water PPP projects.At present,the government bears a very heavy financial pressure.The emergence of PPP,a new mode of public-private partnership,has made the government no longer have difficulty in building large-scale infrastructure.Especially in the construction of water projects which need a lot of capital investment,this model can effectively alleviate the tension between capital demand and development demand.Risk is complex and objective.Private sector needs to share risks well in order to complete the construction of PPP project more smoothly and obtain the expected return of operating income.Therefore,water enterprises should do a good job in risk identification and risk assessment,effectively prevent and control the risks that may arise under PPP mode,so that the project can be completed smoothly,and pass the qualification test to investors.Bring considerable benefits.Therefore,combined with practical experience,this paper summarizes the theoretical basis of existing PPP projects,and takes the cooperative construction of sewage treatment plants between Bishui and 13 towns in Qianshan County as an example,comprehensively identifies and analyses the potential factors affecting the application of PPP financing mode.Through the analytic hierarchy process,the risk factors of applying PPP model to Bishui water source are dealt with hierarchically,the hierarchical structure of risk management is established,and the evaluation index system of risk factors is constructed.Finally,the importance weight of each risk factor is ranked to complete the risk evaluation.It is concluded that the internal risk of the project is greater than the external risk of the project than the risk of the project participants.It also discusses how to better apply PPP model to water enterprises such as Bishui Water Resources Company,and puts forward practical suggestions for risk management.Firstly,for project internal risk management,it is suggested that enterprises increase investment in scientific research and innovation,vigorously develop proprietary sewage treatment technology,and control design risk to the greatest extent to ensure that the project can be completed and put into use on time.For project contract risk,enterprises should improve operation efficiency,avoid the inefficiency of dealing with contracts and fail to recover funds on time,thus affecting the normal operation of enterprises.Then,in view of the risk management of project participants,water enterprises should fully understand and give full play to their advantages and enhance their competitiveness in the market so as not to be overtaken by similar enterprises in terms of business ability and encroach on their market share;enterprises should not rely solely on loans provided by banks,but should broaden financing channels and reduce financial risks;water enterprises should stipulate terms in contracts.It specifies in detail the obligations and risks to be performed by third parties.Finally,in view of the risk management outside the project,water enterprises should take the legal policy seriously,because it can produce both favorable benefits and possible risks of change.And water construction units should be vigilant against climate change,do a good job of protection,prevent natural disasters from damaging the construction situation;at the same time,we should pay attention to the impact of public opinion,to avoid public discontent on the progress of the project.At the same time,the reasons why Bishui can gain the leading position in the industry are analyzed.It is hoped that other companies in the same industry can learn from its successful practices.First point: Bishui's financing risk factors are small: Bishui paid attention to cooperation with financial institutions at the beginning of the company's establishment,and signed a long-term strategic cooperation agreement with China Development Bank,which directly made its financing risk in the water industry has been at a low level.Therefore,other enterprises in the same industry should seek more financial support,rather than relying solely on bank loans.We should broaden financing channels,strengthen business links with banks,insurance and funds,control financial risks,prevent financial crises and reduce financing risks.Secondly,market competition risk factors and project pre-design risk factors are relatively small: because Bishui has complete patent technology advantages,it can take the lead in the PPP market of sewage treatment industry.Therefore,other enterprises in the same industry should vigorously develop scientific and technological innovation,strive to master core technology,improve their core competitiveness,promote new development by innovation,and reduce market competition risk and pre-project design risk.