Analytical cash-flow based project model to facilitate project appraisal
9 March 2016 – Milan, Italy – A new resource has been added to the PM World Library related to project financing, major projects, infrastructure and public-private partnerships. The new resource is titled “Infrastructure public-private partnership project ecosystem – financial and economic positioning of stakeholders.” This paper was published in The European Journal of Finance.
The paper proposes the construction of analytical cash-flow based project model focuses on ecosystem and its stakeholders in public-private partnership projects. In this model, the flows of cash (private sector) and the flows of costs and benefits (public investors) are integrated in a single framework. The model has been applied successfully in Finnish PPP road project, the E4 between Helsinki and Lahti. This model captures only non-behavioral variables (real cash and economic flows), excluding behavioral elements of risks and uncertainties.
The analytical PPP ecosystem model highlights that private investors must rely on real cash flows and this may be ensured best by putting the service provision under market test and building on direct payments from the users. The model shows that within the ecosystem the investors’ (public and private) social, economic and financial targets are not necessarily coinciding. This model reveal some of the problems associated with different behavioral patterns.
To access this new resource, go to https://pmworldlibrary.net/applications-and-industries/, then “P/PM Applications” section, click on “Project Financing”. Must be a registered member to access.
Posted by: Anton Setiawan