Sally Fitzgibbons Foundation

Beginning the Academic Essay

The term “project finance” is used loosely by academics, bankers and journalists to describe a range of financing arrangements. Often bandied about in trade journals and industry conferences as a new financing technique, project finance is actually a centuries-old financing method that predates corporate finance. However with the explosive growth in privately financed infrastructure projects in the developing world, the technique is enjoying renewed attention. The purposes of this note are to contrast project finance with traditional corporate financing techniques; to highlight the advantages and disadvantages of project finance and ; to propose that a single structure underlies every project finance transaction; to explain the myriad of risks involved in these transactions; and, to raise questions for future research

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