Project finance and risk management Research Proposal

Project finance and risk management - Research Proposal ExampleIn this case, the payment of the loans comes from the organization, backed by the organizations entire balance sheet, as opposed from the revenues of the regards. Similarly, the lenders conceive the strength of the balance sheet of the organization financial backing the project as a prerequisite for lending. The reputation of financing projects is quite dynamic considering the fact that projects dismiss be large or small and can be public or private projects. Despite the enormous benefits that come with project finance, it is vital to post that these projects do carry with themselves many risks, some of which may relieve oneself far-reaching implications. In essence, special project vehicle (SPV) undertakes projects in project finance because the projects are off-balance sheet transactions. However, project managers have discovered the best modal value to counter the challenge through effective allocation of risks hence improving the performance of project financed by different companies. In fact, this project financing and risk management go hand in hand, as the former needs the latter in order to ensure efficient project financing and attainment of the project objectives. ... In this case, a number of risks ranging from political risks to feasibility risk and at that placefore this paper bequeath take a close look at how to manage project related risks in the pipeline of financing challenging projects. This will be especially significant because for every project being finance, there is a risk associated with the implementation of the project although the risks could be managed through proper mechanisms and expertise. Keywords Risk allocation project finance Risk Management 2.0 Justification of the proposed research Undoubtedly, many of the successful projects receive their fiances from the dedicated corporates and non-governmental organizations depending on the nature and complexity o f such projects. In this case, project financing may encompass the creation of a project that is independent and receives its due equity from one or more of the sponsoring entities with a view of fashioning maximum investment in capital assets (Esty 2004, pp. 2013-224). More often than not, project financing involves large projects that contend across nations although some of the companies involved may finance projects on a small-scale basis. Indeed, project financing is the development model for the 21st century given that during the year 2001 alone, capital investments worth $ 200 one million million million were financed by various project companies across the globe. With an annual growth rate of 20 %, such projects have seen nations achieve unprecedented economic development rates amid domestic challenges (Kleimeier and Versteeg 2010. pp. 49-59). Although project finance works hale in areas that are less prone to risks, it is obvious that the presence of risks in any project accentuates the implication of such projects. This means that project fiance