Research On Risk Sharing Of Infrastructure PPP Projects

Benefits for both private and public sectors arise from the link between infrastructure and the PPP(Public-Private Partnership)model.However,risks are still present in the cooperation.Additionally,there are policy,legal,market and investment risks in infrastructure construction.These potential risks have increased the difficulty of the public and private sectors in promoting the PPP model.After a review of the relevant literature,both domestic and international,this paper goes into the theoretical background of the combination of urban infrastructure construction and the PPP model and analyzes the risk identification,classification,assessment,and sharing of the PPP model for construction projects and puts forward a reasonable risk sharing model for PPP construction projects.This principle of risk sharing is defined,the framework established,and the model constructed.Considering the long-term and complex nature of the PPP model and the direct/indirect correlation between risk factors,this paper uses the cross-entropy method to determine the weight of risk indicators between different department so that the reader has a clear view of the risks and can judge the risk of a project by the indicators.According to the index weight calculated by the cross-entropy method,the correlation is calculated,the comprehensive risk value is determined,and the risk sharing model is constructed.As an example,we use Beijing Metro Line 4,the first urban infrastructure program that uses PPP and applies the risk sharing model.This paper uses the model to calculate the 16 kinds of risks,according to the of association and the principle of grey association theory,the sharing results are determined.This verifies the practical and theoretical reference value of the risk sharing model.Finally,based on the calculation results,the risk management of the PPP infrastructure project is proposed.The model established in this paper is beneficial in helping share risk among responsible parties in PPP projects.The majority of risk should be allocated to the most responsible party and this is conducive to the projects smooth implementation.The framework within can be used as a reference for reasonable risk sharing in the process of applying the PPP model to urban infrastructure construction projects.