Discussion On Financial Risk Management In PPP Mode

Under the PPP model,both the government and the private sector can achieve the long-term goal of stability and mutual benefit,and provide more and better services to the society and the public.Exploring the application of PPP mode is conducive to improving the efficiency of resource utilization and construction and operation efficiency,reducing the financial pressure of the government and promoting the development of social modernization.However,due to the extensive involvement of PPP projects,high requirements for pre-construction preparation,large amount of project capital input,long construction time,large variables during the period,and relatively complex contract structure,it is faced with many risk factors and large financial risks.In practice,risks of PPP projects are the common concern of all parties involved,and there are numerous cases of project failure due to risks.Discussing the financial risks of PPP model is conducive to the smooth implementation of the project,improving the operation efficiency of the project,and maximizing the overall benefits of the project.For the social capital,through the analysis of the PPP model financial risk and management question discussion,can be intuitive understanding of his/her needs before the project risk and the need to the risk of both sides share proportion,can undertake self assessment in advance,or make risk response plan,or withdraw from the project construction,so as to avoid unable to control the risk of social capital into the construction of the PPP project,cause needless loss of society as a whole benefits.For the government,through the analysis of the financial risks of the PPP model,the possible financial risks can be prevented in advance,so as to maximize the economic and social benefits of the project.At home and abroad in this paper,through study and draw lessons from the PPP project finance risk management related theory and practice experience,the financial risk of PPP project case investigation and analysis,in order to be able to provide the theoretical reference to the PPP project financial risk management in the future,make the PPP project more reasonable and efficient measures to prevent financial risks,avoid the PPP project to produce financial risk and reduce its adverse influence,in order to promote the field of theory innovation and the sustainable development of the PPP mode.According to the basic idea of "theory overview-case analysis-research conclusions and implications",this paper firstly extracted the concepts and theories of PPP model,its financial risk and risk management from domestic and foreignliteratures,which served as the theoretical basis for subsequent discussions,and summarized the deficiencies in the current research field.On this basis,with liupanshui city underground pipe rack case study of the PPP projects,brief introduction of liupanshui city underground pipe gallery PPP projects running situation,including the project background,project company set up,project investment plan and the project the PPP architectural patterns,briefly summarizes the status of the project financial risk management.This paper analyzes the financial risk of PPP project of underground comprehensive pipe corridor in liupanshui city.By combining qualitative and quantitative methods,it analyzes the causes of financial risk of this project from both internal and external factors.Identify the financial risks faced by the PPP project of underground comprehensive pipe corridor in liupanshui city,including financing risks,investment risks,cost overruns and capital recovery risks;And to its index analysis and evaluation evaluation.Based on the financial risks identified and evaluated above,corresponding control measures are proposed for different financial risks faced by the project.To deal with financing risks,we can improve financing efficiency,optimize capital structure and form multi-channel financing.To deal with the investment risk,it can be realized by constructing the efficiency dynamic cost management system and strengthening the management of investment funds and overall budget.To deal with the risk of cost overruns,we can take reasonable measures to select project contractors,strengthen cost control and improve contract contents.To deal with the risk of capital recovery,we can adopt floating pricing mechanism,strive for government subsidies,and optimize the timing and order of entering the corridor.Based on the above analysis of financial risk management of the PPP project of liupanshui underground comprehensive pipe gallery,the conclusion of this paper is drawn.It is believed that in PPP mode,the government and the social capital should reasonably allocate the financial risks of PPP projects according to the principle of risk-return matching and reciprocity.The social capital should bear the risks of financing,cost overruns and capital recovery,while the investment risks and income distribution risks should be Shared by both parties.And the financial risk of the PPP project risk policy changes by law,land approved risks,risks of delay of examination and approval,completion risk,inflation risk,interest rate risk,the influence of the force majeure risk and other risks,so the government and social capital in thefinancial risk to comprehensive considerations,comprehensive evaluation,the two sides to jointly cope with.All parties should strengthen the construction of financial risk management system,establish the risk control chain of "risk prevention-risk sharing-risk transfer-risk utilization-risk acceptance",control the financial risk of the project within the acceptable range,achieve the balance of risk and benefit,and optimize the cost and benefit.