Sector Investment Projects Research Articles

Cost-Benefit Methodology in Public Investment in the Peruvian Educational Sector of Invierte.Pe. a Practical Case

Objective: The purpose of the research is to show a specific process to perform the cost/benefit analysis in the social evaluation of public investment projects in the education sector, applying the net present value (NPV) and internal rate of return (IRR) profitability indicators, taking into account that the approach of the National System of Multiannual Programming and Investment Management (Invierte.pe) applies a different methodology as the cost/efficiency analysis, where it uses criteria such as the Present Value of Costs (PVC) and the Cost Efficiency Indicator (CEI). Theoretical framework: In order to present our proposal, we used as a theoretical framework, mainly the directives, instructions, procedures, and methodological guides proposed by the Ministry of Economy and Finance of Peru, which can be improved by considering the results of investment in education. Method: The research proposes a technique to evaluate investment projects in the education sector through the cost/benefit methodology instead of the cost/effectiveness methodology. Within the materials and methods, an education sector investment project approved by Invierte.pe was used, and we added cost/benefit analysis to estimate the profitability indicators NPV and IRR to carry out the social evaluation of the project. Results: The results show that the education project has a net present value of S/. 794,874.30 at social prices, and an internal rate of social return of 9.56%. Finishing the research, it can be concluded based on the results obtained that it is possible to incorporate the cost/benefit methodology in the formulation and evaluation of standard, simplified technical sheets and studies at the profile level of public investment projects in the education sector. Conclusions: It can be concluded that it is feasible the social evaluation of investment projects in the educational sector of the Peruvian state, through the cost/benefit methodology in the region and the country, by means of the profitability indicators NPV and IRR, obtaining a higher internal rate of return.

Development and justification of the system methodological approach to assessing the investment business project implementation efficiency under conditions of the external market environment factors impact

Evaluating the effectiveness of the implementation of an investment project is a key issue when making management decisions both at the stage of setting up a startup and for expanding an existing business. This paper reports a systematic approach to building a mathematical model to solve the task of forecasting the effectiveness of business projects, taking into account the influence of factors of the external economic environment. Proposed factors include the impact of supply and demand on the price of goods, political and industry risks, the volume of commodity supply and sales. In view of this, a method for calculating the political component of the discount coefficient using the Fourier series has been proposed. Using the theory of differential equations, correlation and regression analysis, a mathematical model for forecasting indicators of efficiency of business project implementation taking into account the influence of factors of the external economic environment has been constructed. Based on it, a generalized algorithm for applying a mathematical model to predict the effectiveness of investment projects in various business sectors has been developed. The results from applying differential equations and variable discount coefficient showed a decrease in NPV by 14 %, and PI by 5.1 %, due to more accurate consideration of the political component in calculating the discount factor. Also, with the influence of supply and demand on the price of goods and nonlinear cash flows, it was found that the payback period does not clearly indicate the effectiveness of the implementation of an investment business project. Determining these factors provides more accurate information to the investor or business owner when forecasting the stability of a business project for making management decisions on its implementation

ASSESSING THE CLIMATE-NEUTRAL INVESTMENT PROJECTS IN THE CONTEXT OF ENVIRONMENTAL PROTECTION AND ENERGY SECURITY

The paper is aimed at studying the methodological aspects of assessing the features and advantages of implementing climate-neutral investment projects in the context of environmental protection and energy security. For this purpose, investigation is focused on the performance of investment projects in nature resource sectors (agriculture, forestry, etc.) that provide renewable resources (biomass) for the generation of green energy. The paper identifies the peculiarities of the transition to low-carbon economy and creation of carbon markets as platforms for the development of a system for managing climate-neutral investment projects. The scientific novelty of this research lies in the improvement of approaches to substantiating the economic feasibility of investments in nature resource sectors in view of the climate change. Namely, a comprehensive approach to comparing alternative variants of investment project solutions in climate-neutral projects is suggested. Moreover, the developed methodological recommendations account for the variable meteorological factors in calculating economic indicators. The paper’s practical value can be seen in the determination of the benefits from the implementation of climate-neutral projects using the example of production and processing of the agro-biomass for the development of renewable energy based on the circular use of resources.

WORLD MARKET OF PROJECT FINANCING: INDUSTRIAL STRUCTURE

Background. The domestic economy remains systemically underfunded due to lack of domestic financial resources and low investment attractiveness for foreign investors. The deepening of this problem is also caused by the situation with COVID-19, which has led to a decrease in global cash flows in the world. Obtaining cross-border investment flows in various sectors of the economy is associated with project financing, the development of co-financing and the use of PPPs. There is a question of research of modern tendencies of development of project financing which change according to present challenges, for the purpose of implementation of experience of foreign countries in the Ukrainian practice of development of investment activity. Analysis of recent research and publications has shown that in the context of abrupt changes, challenges and crises, leading to reduction oflong-term investments, the issue of using large-scale project financing to guarantee future profits (project financing) to develop priority sectors of the economy and individual regions of the country remains relevant. The aim of the work is to study the global industry trends in the development of project financing, taking into account the new socio-economic realities and justification of the feasibility of using world experience in Ukrainian practice. Materials and methods. The research methodology is based on a system of general scientific and special methods, in particular: abstract-logical, analysis, synthesis, comparison, grouping, generalization, graphical method, statistical methods for assessing the dynamics and structure. Legislative documents, scientific works of domestic and foreign scientists, statistical information became the information base of this research. Results. The modern tendencies of the global market of project financing, dynamics of its volumes and branch structure are investigated. The directions of project financing by the main sources are analyzed: bank loans and bond loans. The expediency of using international experience in the implementation of large-scale investment projects in various sectors of the economy of Ukraine using schemes and methods of project financing is substantiated. Conclusion. The introduction of experience in the implementation of investment projects using project financing schemes in Ukraine should contribute to the formation of demand for long-term investments, including foreign ones. This practice of project implementation allows to modernize the economy, increase the potential of regional development and integrate into global value chains.

Fuzzy Clustering Approach for Marketing Recycled Products of Tabriz Municipality Waste Management Organization

The main concern of municipalities is the realization of sustainable revenues. Organizations affiliated with municipalities should play a role in generating revenue by defining specialized tasks while assisting municipal tasks. Tabriz Municipality Waste Management Organization seeks to achieve this by defining its strategies and goals. The organization has implemented various projects to generate revenue from recycled products. Poor planning and failure to fully outsource are among the obstacles of this organization. Therefore, marketing of recycled products is an important project. Lack of careful planning in this regard, marketing costs and weakness of private sector investment projects are the most important obstacles facing the organization. This article has determined the degree of homogeneity of waste organization projects in the marketing of recycled products with a fuzzy clustering approach and according to the opinions of experts. The results show that some of the organization's projects lack value. Instead, some projects, such as the construction of a recycling town with a variety of recycled products, renewable energy recycling, and plastic recycling with a variety of products, have similar features in the product mix marketing element, and this can reduce marketing costs and Focus on such projects.

Planning and Management

In this study, the new approaches in manufacturing industries, investment project planning and management have been searched. These approaches are; Project Cycle Manufacturing, Integrated Project Cycle Management Approaches, Project Planning Logician Frame Approaches. In this approaches manufacturing sector investment project detail searched and necessary procedures have been explained in every rank. Project planning process with interesting project cycle management by different countries and international business adapted to themselves and developed. So getting decisions related on investment process have been systematizioned .

Preparing for Successful Collaborative Contracts

Preparing well before entering a contract is always vital, independent of the characteristics of the project and type of contract. However, as projects become larger and more complex, and value for stakeholders and society becomes the dominating perspective on success, the need for well-developed collaboration is becoming more and more critical. In this paper, we investigate how the parties should prepare for a collaborative project. The purpose is to help owners secure the success of the project for its key stakeholders. We choose to address the issues as an active risk mitigation strategy that serves as a vehicle to reduce uncertainty, avoid unnecessary risks, and utilize opportunities as a project owner. We look at the project mainly through a project owner perspective, but on key points, we contrast this with contractor perspectives. The research was performed in Australia in 2020 and includes public and private sector investment projects. The methodology is qualitative case studies and includes primarily in-depth interviews supplemented with document studies and two workshop group discussions. The paper highlights the difference between being collaborative in a contract and using a collaborative contract. The results document significant differences in preparations depending on the degree of complexity of the projects. One major difference is illustrated in the different levels of precision in terms and definitions used in communication. Complex projects require freedom of interpretation only gained by allowing wide and less precise expressions.

Brunei Darussalam

Brunei Darussalam’s economy has been adjusting to the lower oil and gas (O&G) prices since 2014, with the authorities undertaking wide-ranging reforms. The reforms aim to ensure long-term fiscal sustainability and intergenerational equity, and to foster economic diversification. Growth is expected to pick up in 2019, with the outlook improving further over the medium term, driven by expansion in the O&G sector and large investment projects. Nonetheless, lower-than-expected O&G prices or production would reduce fiscal revenues and exports, with significant spillovers to the non-O&G sector.

The Assessment of Ecosystem Services in Urban Areas

The Assessment of Ecosystem Services in Urban Areas

Feasibility Study of Construction Project in Compliance with Bank Investment Supervision Requirements

On the basis of the 12-year author's practice of Bank Investment Supervision developed methodology significant construction projects risks have been identified and measured: risks of the highest impact values and risks of the biggest likelihood appearance. The research has been recorded in 400 - 450 reports of 42 investment projects in advanced manufacturing, commercial, residential, hotels and apartment housing sectors. At least one risk of the highest measured level of significance has been highlighted at each phase of investment process: design, construction and maintenance. A reasonable level of risks significance has been determined which stands for not more than 1/3 of possible significance in “risks monitoring” strategy. Engineering, Project and Construction Management (EPCM) approach to investment process and solid, consequent, regular construction projects monitoring executed by professional Banking Supervision Inspector (BSI) make possible to minimise any faults of inappropriate financing of construction projects.

Economic Impact of Thermal Insulation of the Building's Envelope

Climate change was the beginning of the depletion of fossil fuels, and increasing expansion in investment projects in various sectors of our life, all play a key role in the increasing demand for energy. So energy is considered one of the biggest priorities and challenges facing the world economy due to the lack of conventional energy sources of crude oil and natural gas used in energy generation. The use of thermal insulation materials in building's envelope is one of the ways to reduce energy consumption. Therefore, this study will address the importance of the use of thermal insulation materials in building' envelope to reduce energy loss as a result of heating and cooling conditions. The case sudy was the implementation of thermal insulation on Engineering Faculty building's envelope/ Muta'h University. The thermal loads were calculated for the building, with and without thermal insulation, by using four common different insulation materials which are; Rockwool, foam concert, double-glazing and extended Polystyrene. The selection of these materials depends on availability in the market, cost of implementation and the coefficient of thermal conductivity. The results showed that the polystyrene extended of thickness 10 cm is the best material for the thermal insulation in comparison of the others. The reduction ratio in thermal transmittance reached up to 76%; while in volume ratio of central heating fuel consumption reached up to 26.7%.

Evaluation of the energy sector's investment projects as a risk management instrument

Evaluation of the energy sector's investment projects as a risk management instrument

Feasibility Study of construction project in compliance with Bank Investment Supervision requirements

On the basis of the 12-year author's practice of Bank Investment Supervision developed methodology significant construction projects risks have been identified and measured: risks of the highest impact values and risks of the biggest likelihood appearance. The research has been recorded in 400 - 450 reports of 42 investment projects in advanced manufacturing, commercial, residential, hotels and apartment housing sectors. At least one risk of the highest measured level of significance has been highlighted at each phase of investment process: design, construction and maintenance. A reasonable level of risks significance has been determined which stands for not more than 1/3 of possible significance in “risks monitoring” strategy. Engineering, Project and Construction Management (EPCM) approach to investment process and solid, consequent, regular construction projects monitoring executed by professional Banking Supervision Inspector (BSI) make possible to minimise any faults of inappropriate financing of construction projects.

ОЦЕНКА РИСКОВ ИНВЕСТИРОВАНИЯ В КОММУНАЛЬНУЮ ИНФРАСТРУКТУРУ РОССИИ

The investment risk evaluation technique for water and sanitation sector in the Russian Federation has been proposed. A review of current legislation revealed that there is no holistic approach to investment risk evaluation for Russian Public-Private Partnership projects in domestic utility sector. The article reveals, that various methods can be used for investment risk evaluation (decision tree, effective percentage rate correction, cost sensitivity analysis and others). The method choice is defined according to the type of investment project, the risk evaluation goal, the available information and the type of the identified investment risk. The proposed investment risk evaluation technique takes due account of Russian utility sector investment projects features and the list of disclosed information.

Estimation of social discount rate for Lithuania

Purpose of the article: The paper seeks to analyse the problematics of estimation of the social discount rate (SDR). The SDR is the critical parameter of cost-benefit analysis, which allows calculating the present value of cost and the benefit of public sector investment projects. Incorrect choice of the SDR can lead to the realisation of ineffective public project or conversely, cost-effective project will be rejected. The relevance of this problem analysis is determined by discussions and different viewpoints of scientists on the choice of the most appropriate approach to determine the SDR and absence of methodically based the SDR on the national level of Lithuania. Methodology/methods: The research is performed by the scientific and methodical literature analysis, systematization, time series and regression analysis. Scientific aim: The aim of the article is to calculate the SDR based on the statistical data of Lithuania. Findings: The analysis of methods of SDR determination, as well as the researches performed by foreign researchers, allows stating that the social rate of time preference (SRTP) approach is the most appropriate. The SDR, calculated by the SRTP approach, reflects the main purpose of public investment projects, i.e. to enhance social benefit for society, the best. The analyses of SDR determination practice of the foreign countries shows that the SDR level should not be universal for all states. Each country should calculate the SDR based on its own data and apply it for the assessment of public projects. Conclusions: The calculated SDR for Lithuania using the SRTP approach varies between 3.5% and 4.3%. Although it is lower than 5% that is offered by European Commission, this rate is based on the statistical data of Lithuania and should be used for the assessment of the national public projects. Application of the reasonable SDR let get the more accurate and reliable cost-benefit analysis of the public projects.

Cost Overruns in Public Sector Investment Projects

We analyze cost overruns in a large sample of public infrastructural investment projects in Portugal. The average cost deviation relative to the budgeted costs amounts to 24%. The large projects even have a higher cost deviation and a higher probability of cost overruns, which suggests that the public administration may not have sufficient expertise to forecast required investments and handle these types of projects. Cost overruns are more likely in election years, reflecting that politicians seem eager to speed up or conclude infrastructural investments, and thus, they inaugurate a new service to harvest political goodwill with the population. We document that cost deviations are reduced over time; however, this reduction does not appear to be the result of the new procurement laws but seem rather the result from the benefits of learning and increased fiscal constraints. A reduction in corruption positively correlates with cost deviations and the probability of cost overruns.

The Situation of Bank Lending in Ukraine: Current Problems and Prospects of Recovery

Abstract The article investigates the state of bank lending in Ukraine, identifies the source of the severe banking crisis, that broke out in Ukraine in 2014-2015. Additionally, it suggests recommendations for the enhancement of the role of bank lending in the process of expanded incentives for investments in order to facilitate the exit from the economy crisis towards the economic growth. Using the general scientific methods of empirical and theoretical research, the dynamics of bank lending in Ukraine in 2003- 2014 was analysed and the following periods were distinguished: 2003-2007, which is the period of the rise of a strong banking system and the increase of bank lending; 2008-2009, when the crisis and post-crisis recovery processes have been attempted, and 2014-2015, which is the period of an unprecedented crisis and a wave of bank failures. The analysis revealed the following main factors constraining the lending to the economy of Ukraine in today’s conditions: a slowdown in the economic growth, increasing economic and political risks of inflation and devaluation expectations, rapid fluctuations of exchange rate, a high cost and the lack of credit because of insufficient domestic resources and the mismatch of terms and conditions of bank loans with the aim to attract resources, a significant credit risk and imperfect methods of management, the lack of clear mechanisms for loan repayment applicable to insolvent borrowers, and inadequate protection of the rights of lenders and borrowers. The article substantiates that the stimulation of the lending process should be based on the following: the improvement of the investment climate in Ukraine, using stricter lending criteria, ensuring effective mechanisms for provisioning for credit risks, and the improvement of measures for the protection of rights of lenders and borrowers. The state should focus on new projects stimulating - international investments by introducing the European standards on domestic enterprises, including joint investment projects in strategic sectors; the promotion of investment projects in support of small and medium enterprises; and intensified efforts to stimulate foreign banks to open credit lines for small and medium-sized businesses to implement energy efficiency projects under the state guarantee.

해양관광자원을 활용한 제주 신양항 리모델링 계획

과거 어항(魚港)은 어촌의 생산 및 지역문화의 거점으로 중요한 역할을 하였으나 현대에 와서는 수산업 여건변화로 인해 그 의미가 퇴색되고 유휴공간이 되고 있다. 한편, 제주특별자치도는 2010년부터 해양관광활성화를 위한 노력을 기울이고 있다. 특히 신양항은 마리나항만 개발 예정구역으로 지정 고시되어 제주오션마리나시티 조성사업계획에 착수하였다. 그러나 이러한 해양관광을 활성화하려는 시도와는 달리 이제까지 시행된 제주도내 어항 리모델링 사업들은 대부분 노후시설을 개보수하는 토목사업 중심이었다. 또한 무분별한 개발로 지역경관을 해치는 사례들도 다수 발생하였는데, 경관은 한번 훼손되면 복구하기 힘들다는 특성이 있어 그 문제가 더욱 심각하다. 관 주도 사업의 경우에는 예산부족으로 투자가 저조하여 보강공사수준의 토목공사만 진행되거나 관리소홀이 문제되고 있으며, 민간투자 사업의 경우에는 수익금의 지역 환원이 되지 않는다는 문제가 제기되고 있다. 신양항 또한 2008년에 리모델링을 하였지만 외곽 방파제 연장공사 수준으로 마무리되어 근본적인 문제를 해결하지는 못하였고, 지역사회 활성화에 직접적인 도움이 되지 못하였다. 이러한 토목공사 중심의 개발, 공간의 관리소홀, 수익금의 지역 환원 문제를 해결하면서 마리나항 건설을 통한 해양관광 및 지역 활성화를 위해 본고에서는 첫째, 주변배후지를 연계한 개발계획을 제시하였다. 지역적 맥락을 읽고 현존하는 지형, 돌담, 길을 물리적인 계획에 활용하여 설계 및 프로그램에 반영하였다. 이를 통해 지역 경관 및 특성을 반영한 공간개발계획을 제시하고자 하였다. 둘째, 해양관광자원의 개념을 정리 및 보완하고, 계획요소를 도출하여 지역에 현존한 자원을 활용하고 새로운 해양관광자원을 도입하여 다양한 이용자의 수요를 충족하는 프로그램계획을 하였다. 셋째, 지역주민의 운영관리 참여를 통해 지속가능한 운영관리 방안을 검토하였다. 본 연구는 토목중심으로 시행되어왔던 어항 리모델링 계획을 조경적 관점에서 배후지와의 연계를 통해 통합적 계획안을 제안했다는 의의를 갖는다. 또한, 환경 사회 경제적 이슈 고려 및 지역주민의 참여 등은 이후 유사한 어항 및 수변공간 리모델링 계획 시 주안점이 될 수 있을 것으로 기대된다. The fishing port was once the foothold of production as well as the stronghold of communities but with the declining of the fishing industry, ports became abandoned space. Jeju Special Self-Governing Province has continued its effort to vitalize marine tourism since 2010. Shinyang Port in particular is designated as a Prearranged Marina Port Development Zone, and planning for the Jeju Ocean Marina City project is underway. Nevertheless, fishing port remodeling projects implemented on Jeju so far have focused only on civil engineering such as renovating old facilities. In addition, most Marina Port Development Projects have been irrelevant to local communities. Leading projects by the local government mostly suffer from a lack of funding, which results in the renovation of old facilities and improper maintenance, while private sector investment projects do not lead to benefit sharing with the community. Shinyang Port, also renovated in 2008, ended up with outer breakwater extension construction that neither solved the fundamental problem of the site nor gave benefits to residents. To arrange a way to solve problems for civil engineering focused development project, improper maintenance, and benefit sharing with community, first, this study proposes a development plan that connects with the outlying areas near the ports. The plan reflects existing topography, Jeju traditional stonewalls, narrow paths on the master plan and programs by reading the regional context. In this way, this paper suggests a space development plan reflecting the local landscape and characteristic factors. Second, it satisfies various needs by using existing and new Marine Tourism Resources. Third, it examines sustainable operation and management measures through residents' participation. The proposal is significant in two key ways: it is a fresh attempt at connecting the fishing port with its outlying areas from a landscape perspective; and it considers environmental, social, economic issues, and suggests participation for local communities. Thus, the model can be used in future fishing-port remodeling plans for revitalizing unused space, including invaluable traditional landscapes, and for boosting the marine-leisure industry.

Comparison of Farmer’s Agriculture Information Channels and Farming Practice in Tanzania

There are mixed empirical evidences on the effectiveness of Farmer Field School (FFS). The evidences on various studies vary because of the setting, evaluation methods and yardstick used. This paper aims to investigate the impact of District Agricultural Sector Investment Project (DASIP) on knowledge and productivity. The study was conducted in the area where (DASIP) operated. This covered five regions namely Kagera, Mwanza, Mara, Simiyu and Kigoma. Within those regions, the study focused on agro-ecological zone where corn was cultivated. The data was collected from 878 farmers out of 971, who were targeted. Among them, 359 were participant and 519 were non-participant farmers. This study employed a five-stage sampling technique. The findings show that the effects of DASIP on participating farmers are very little as they resemble non-participating farmers in terms of knowledge and farming practices. Despite that, non-participating farmers are 8.724 times the odds of corn yield not to increase compared to participating farmers. Based on findings, it may recommended that, agriculture programmes should run smoothly by providing technical and financial commitment to improve the performance of extension officers.

Systematization of the major stages of the client in certain branches of construction production

The article contains substantiation of the need for investment and construction projects in various sectors of the construction production. On the basis of domestic and foreign experience it describes the concept of the client (customer) and his functions and tasks in the implementation of such projects. It also systematizes the main stages of the customer’s activities, which are presented as a preparation for the construction, development of construction sites, monitoring the progress of the construction, commis-sioning and commissioning of facilities. There is also a determination of time intervals at each stage, the final formula for calculating the duration of the investment project due to the given the shared stages. The article also gives optimization variants in some sectors of construction production.