Tài liệu PROJECT APPRAISAL AND RISK MANAGEMENT FOR THE PUBLIC SECTOR pdf

THE ROLE OF PROJECT APPRAISAL z To stop bad projects z To prevent good projects from being destroyed z To determine if components of project are consistent z To assess the sources and

PROJECT APPRAISAL

AND RISK MANAGEMENT FOR THE PUBLIC SECTOR

CAO HAO THI

I THE ROLE OF PROJECT APPRAISAL

z To stop bad projects

z To prevent good projects from being destroyed

z To determine if components of project are consistent

z To assess the sources and magnitudes of the risks

z To determine how to reduce risks and efficiently share risks

II STAGES IN PROJECT APPRAISAL

AND APPROVAL

zWhy should a project evaluation be done

in stages?

a Idea and project definition

b Pre-feasibility study

c Feasibility

d Detailed design

e Project implementation

B PRE-FEASIBILITY STUDY

z Example overall potential of project

z Should maintain same quality of information across all variables

z Whenever possible should use secondary information

z Biased information better than mean values

KEY QUESTION

a Is this project financially and economically feasible throughout the project’s life?

b What are the key variables?

c What are the sources of RISK?

C FEASIBILITY STUDY

z Focus is on improving accuracy of the key Variables

z Alternatives for reducing risk are examined in detail

z Some primary data may be needed

KEY QUESTION

– Is project financially attractive to all interested parties in activity?

– What is level of uncertainty of key variables?

– Can final decision for approval be taken?

III MODULES OF PRE-FEASIBILITY AND

FEASIBILITY STUDIES

Why break study into Modules?

BUILDING BLOCKS

a Marketing or demand module

b Technical or engineering module

c Management and manpower module analysis

d Financial/budget module

e Economic module

f Social module

BASIC NEEDS ANALYSIS SOCIAL ANALYSIS ECONOMIC ANALYSIS FINANCIAL ANALYSIS

MARKET ANALYSIS TECHNICAL ANALYSIS RESOURCES ANALYSIS

?

ACCEPT

REJECT

? ECONOMIC ANALYSIS

+

A IDEA AND PROJECT DEFINITION KEY QUESTIONS:

a Where is the demand?

b is this project consistent with company's expertise and strategy?

A MARKETING OR DEMAND MODULE

z Study of sources of demand, nature of market, prices and quantities

z Major distinction between domestic versus internationally traded goods and services

z For internationally traded goods secondary information most important

z For domestic market, primary research more important

OUTPUT OF MODULE

– Forecast of quantities and prices for life of project

– Taxes, tariffs, subsidies, public regulations, technological trends

TECHNICAL OR ENGINEERING MODULE

z A study of input requirements for investment and operations and their costs

z In this module, secondary information can’t be used very effectively need to a void conflict of interest between supplier of technical information and seller of investment equipment,

or contractor for construction

OUTPUT OF MODULE

– Technology and life of project

– Quantities of inputs by type needed

– For investment and operation

– Labour required by type and time

– Input prices and sources of supply

C MANAGEMENT AND MANPOWER

MODULE

z What are managerial needs of project?

z Does organization have the ability to get types of managerial skills needed?

z Is timing of project consistent with quantity and quality of management?

z What are wage rates for labour skills required?

z Manpower requirements by category are reconciled with availabilities and project timing

D FINANCIAL MODULE

z Integration of financial and technical variables from first three modules

z Construct cash flow profile of project

z Identify key variables for doing economic and social analysis

KEY QUESTIONS:

a What is relative certainty of financial variables?

b What are sources and costs of financing?

c What are minimum cash flow requirements for each of private participants?

d What can be adjusted to satisfy each of the participants?

E ECONOMIC MODULE

zExamines the project using the whole country as the accounting entity

KEY QUESTIONS:

a What are sizes of differences between financial and economic values for a variable?

b What causes these differences?

c With what degrees of certainty do we know values of these differences?

d For economic viability what proportion of

F SOCIAL OR DISTRIBUTIVE

APPRAISAL

zIdentification and quantification of extra-economic impacts of project

zIncome impacts on various group

zBasic needs impact on specific sectors

KEY QUESTIONS

a What social objectives could the project have an impact on their achievements?

b Who benefit and who pay the costs?

c In what ways does project generate beneficial and cost impacts on groups?

d What alternative ways are there to generate desirable social impacts?

e Is project relatively cost effective in generation of desirable social impacts?