RISK MANAGEMENT IN PPP PROJECTS IN EGYPT
AHMED MOHAMED ABDALMOUJOUD;
Abstract
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Abstract
Recently, the growing demand for infrastructure services in Egypt has led to the need of additional capital and investment in the infrastructure sector. Such need directed the Egyptian government to Public Private Partnership (PPP) projects approach. Due to the increase of stakeholders in such projects and their long lifecycle, these projects meet many risks and significance uncertainty.
This study aims to identify and analyze the risks affecting PPP projects in Egypt from project lifecycle perspective. Hence, a risk checklist along with a question brainstorming were conducted to identify the major risks in PPP projects in Egypt. Seventy six risk factors were identified, then probability of occurrence and impact of each of these risks were obtained through questionnaire survey guided with interviews. Further statistical analysis were performed in order to examine risks’ severity and their relative importance. According to the Egyptian PPP’s National Program of PPP, risk should be allocated to the best party able to handle these risks, so allocation and mitigation for the high ranked risks were investigated. A comparative study for the results was conducted through “Law No. 67 for the year 2010, Egypt, issued through Prime Ministerial Decree No. 238 for the year 2011”, and through similar studies in order to evaluate data reliability and validity.
Results showed that the most severity risk factors are high finance costs, debt risk, government corruption and intervention, late design variation, improper contracts, operation revenues below expectations and lack of reliability of government respectively. Further analysis was conducted on the high ranked risks to find the preferable allocation of risks and the suitable response strategy. Manny-Whitney U-test result indicated that there is no significance difference in risk factors ranking between public and private sectors.
This investigation assists in risk response planning and control for future PPP projects in Egypt. Also, these up-to-date findings of this investigation demonstrate a useful reference for private entities who are planning to operate their business through PPP projects in Egypt. Moreover, these findings present a valuable data for the Egyptian government to have an in-depth understanding of the risk environment in PPP projects.
Abstract
Recently, the growing demand for infrastructure services in Egypt has led to the need of additional capital and investment in the infrastructure sector. Such need directed the Egyptian government to Public Private Partnership (PPP) projects approach. Due to the increase of stakeholders in such projects and their long lifecycle, these projects meet many risks and significance uncertainty.
This study aims to identify and analyze the risks affecting PPP projects in Egypt from project lifecycle perspective. Hence, a risk checklist along with a question brainstorming were conducted to identify the major risks in PPP projects in Egypt. Seventy six risk factors were identified, then probability of occurrence and impact of each of these risks were obtained through questionnaire survey guided with interviews. Further statistical analysis were performed in order to examine risks’ severity and their relative importance. According to the Egyptian PPP’s National Program of PPP, risk should be allocated to the best party able to handle these risks, so allocation and mitigation for the high ranked risks were investigated. A comparative study for the results was conducted through “Law No. 67 for the year 2010, Egypt, issued through Prime Ministerial Decree No. 238 for the year 2011”, and through similar studies in order to evaluate data reliability and validity.
Results showed that the most severity risk factors are high finance costs, debt risk, government corruption and intervention, late design variation, improper contracts, operation revenues below expectations and lack of reliability of government respectively. Further analysis was conducted on the high ranked risks to find the preferable allocation of risks and the suitable response strategy. Manny-Whitney U-test result indicated that there is no significance difference in risk factors ranking between public and private sectors.
This investigation assists in risk response planning and control for future PPP projects in Egypt. Also, these up-to-date findings of this investigation demonstrate a useful reference for private entities who are planning to operate their business through PPP projects in Egypt. Moreover, these findings present a valuable data for the Egyptian government to have an in-depth understanding of the risk environment in PPP projects.
Other data
| Title | RISK MANAGEMENT IN PPP PROJECTS IN EGYPT | Other Titles | إدارة المخاطر لمشاريع الشراكة بين القطاعين العام و الخاص | Authors | AHMED MOHAMED ABDALMOUJOUD | Issue Date | 2015 |
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