Research On Risk Assessment Of Financial Lease For Reclaimed Water Project Based On Entropy Measurement

With the continuous improvement of urbanization rate in China,China’s water resources environment is suffering from the pain of pollution,many regions are directly facing the severe situation of water resources shortage,which it has become one of the factors restricting the overall development of China’s economy and needs to be addressed immediately.As one of the most effective ways of municipal sewage recycling,the reuse of reclaimed water is receiving more and more attention.However,reclaimed water projects involve large investments with long construction period but even longer investment return period.Therefore,for a long time,it has been a lack of effective social capital support but merely dependent on government investment,which the development of China’s recycled water industry has lagged behind the international level.As a result,the expansion of financing channels for reclaimed water projects has become a top priority for the development of reclaimed water industry.Financial leasing mode has the dual characteristics of “financing capital” and “financing goods” and has been widely applied into various infrastructure constructions.In this paper,the financial leasing model is introduced to the reclaimed water projects.And by analyzing those risk factors,a specified risk evaluation index system and assessment model are generated and can work as a theoretical framework for reference during risk assessment of this kind of projects.Meanwhile,this system and model are meaningful to leasing companies to assess and identify risks when dealing with reclaimed water projects.The literature review method,entropy measurement method and case analysis method are used respectively in this paper.Theory researches of the experts at home and abroad experts on financial leasing,financing of water utilities and project risk evaluation are reviewed and summarized,which lays a theoretical foundation for the following aspects of financial leasing model’s participation in the construction of recycled water projects,such as risk assessment and model application;On the basis of the construction of the evaluation index system,the risk evaluation model of financial leasing participating in the recycled water project is established by entropy measurement method,which assesses the risk in the reclaimed water financing project of company T,providing a reference for financial leasing companies to make decisions.In the beginning,this paper reviews the current situation of risk assessment theories of finance lease,water facility financing and project finance lease at home and abroad.Then,it is summarized from the two dimensions of recycled water project and finance lease industry respectively,which analyzes the application advantages and scenarios of finance lease model in the construction of reclaimed water project,and puts forward the risks of finance lease in the application of reclaimed water project.Meanwhile,the theoretical basis of risk evaluation of finance lease project and the general method of risk evaluation are expounded to lay a theoretical foundation for the following analysis.After that,based on the theoretical basis of risk assessment,the risk characteristics,types of risks as well as sources of risks of financial leasing for reclaimed water projects are analyzed in detail.Then combining the characteristics of the construction of reclaimed water projects and taking comprehensive risk factors into account,the risk factors of the finance lease of reclaimed water projects are identified,summarized and screened,so that the risk evaluation index system and the risk evaluation model are built up.From the perspective of the leasing company,the actual application of the entropy measurement method in the financial leasing of a reclaimed water project is introduced in detail through a practical case,to evaluate the financing risk of the reclaimed water project,test the rationality and practicality of the risk evaluation model,and put forward corresponding risk countermeasures.Finally,the conclusion of this paper is summarized,and the shortcomings of this paper are put forward.At the same time,the future research direction of this paper is prospected.Key findings and conclusions are as follows:(1)This paper introduces the application advantages and scenarios of financial leasing in reclaimed water projects,which provides a strong guiding significance for the practical application of financial leasing in the sewage treatment industry.(2)In this paper,8 primary risk evaluation index and 24 secondary risk evaluation indexes are finally constructed through sorting and analysis in the process of financing and leasing of reclaimed water projects.The entropy measure method can effectively understand the influence degree of each risk index in the process of financing and leasing of reclaimed water projects,and provide decision-making guidance for leasing companies to choose appropriate reclaimed water projects.(3)This paper tests the application of entropy measurement in specific projects through actual cases,which can provide certain inspiration for leasing companies with different risk preferences.Leasing companies can dynamically adjust the risk evaluation index system according to their own risk preferences.(4)Based on the perspective of the leasing company and combined with case of company T,this paper puts forward risk coping strategies for the financing leasing of reclaimed water projects from the perspectives of pre-leasing,leasing and post-leasing,which has strong pertinence and provides practical operational support for the risk prevention of the leasing company.