The global market for infrastructure finance is one of the biggest markets in the world with exponential growth rates. The G 20 estimate global demand for infrastructure finance until 2038 at 94 trillion USD, the majority of which will be invested in emerging economies with, sometimes, high risks and weak institutional structures.

The course addresses the challenges emerging in large-scale infrastructure investments in high risk countries. The complexity of megaprojects like the Hamaca oil field (Venezuela), the Chad-Cameroon pipeline or the construction of Hong-Kong Disney Land results in managerial and financial problems that are more pronounced than in traditional corporate investment. Projects are exposed to extensive political, financial and commercial risks. For foreign investors, risk management becomes a key consideration.

In the course, possible strategies for diversifying, transferring and mitigating risk are discussed, based on case studies and empirical academic studies. Such strategies include financial strategies (project finance), contractual strategies (hedging, insurance, guarantees and non-financial contracts) as well as classical strategic and managerial considerations (alliances, co-investment, joint-ventures, management fallacies in megaprojects).

During the course, students

•  have acquired theoretical and conceptual knowledge on the nature and particularities of large scale- infrastructure investments,
• become acquainted with the market for infrastructure projects, in particular in developing countries
• have a systematic understanding of risk management techniques in large megaprojects
• are able to analyze and implement a variety of interdisciplinary risk management strategies in international infrastructure investment
• can apply valuation techniques to large-scale infrastructure projects
• become acquainted with a number of successful and unsuccessful cases of infrastructure projects.

Presence in all sessions is mandatory.

• The course is divided in equal parts in lectures and interactive presentations. Each session will start with a written group assessment of the compulsory reader and last session’s content. The written group assignments are marked. This will be followed by
• a theoretical lecture on the topic at hand. This is followed by student presentations and interactive discussions. Student presentations make part of the final mark.
• In groups, students present one case study and an empirical academic paper on the topic.
• Students are required to read two compulsory readers before each session.
• After the block seminar, students write a home take essay on infrastructure finance.

• Written group assessments: 20 %
• Case Presentation (group): 25 %
• Paper presentation (group): 25 %
• Final essay (individual): 30 %
• Bonus points for in class contribution (max of 10%)

There are no specific requirments. Late registration is handled by the CEMS Office.

No specific prerequisites.

Assoc. Prof. Dr. Jakob Müllner

jakob.muellner@wu.ac.at

Open office hours: Tuesday 10-12