Project Financing And Urban Infrastructure

In China, the growth of economics aggravates the contradiction between the urbanization and urban infrastructure. Urban infrastructure has become the bottleneck of the economics. It also prevented improving of investment environment and standard of living of civilian. The reason for undeveloped urban infrastructure is shortage of funds. The government has not be able to afford to invest in urban infrastructure alone. By the successful case in shanghai and other cities, Project Financing is a good means to solve this problem.Project Financing is a financial means to raise funds for the construction and development of large projects. The base of Project Financing is the cash flow of the project. Compared with traditional means, it has the features of project orientation and limited recourse. These features make the possibility of raising funds for the project which will never get loan by traditional means. In Project Financing, different kinds of financing structures can be designed to meet different needs of the participants of the project.It's still a long process to construct of the Project Financing system in investment of urban infrastructure though there are so many successful cases of Project Financing in China. Many factors, such as law, the ability of government administration and the capital market development still restrict the application of Project Financing in investment of urban infrastructure.Through analysis, this article will discuss the application tactics of Project Financing and put forward the suggestion of promoting the development of Chinese Project Financing in macro aspect.This article is divided into five aspects. Chapter 1 mainly discusses the development status of the Project Financing and the problems existing in the investment of Chinese urban infrastructure at present. Chapter 2 analyzes the features of Project Financing and briefly introduces the structure of guarantee and the value measuring in the Project Financing, in order to provide academic fundament for the analyzes in next chapters. Chapter 3 analyzes the application of Project Financing in funds raising of urban infrastructure, at the same time discusses its affection toreferred beneficial entity and the relationship between capital markets and Project Financing. Chapter 4 designs a Project Financing plan to raise funds for the Wuhan Yangtze Tunnel project. Chapter 5 analyzes the obstacle existed in development of Project Financing in China and raise some suggestion about how to promote healthily development of Project Financing in investment of urban infrastructure in our country.