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 lectures and interactive presentations.
• Each session starts with a lecture on the topic in the morning.
• In the afternoon, 5 groups of students present cases and scientific research.
• Afternoon sessions also include guest speakers.
• Students are required to read two compulsory readers BEFORE session 1 and two more compulsory readers before the final session. Compulsory readers, as well as course content, from the basis of 4 written group assessments. These assessments are due on the same deadline as the final essay. They are graded strictly on a group level.
• After the block seminar, students write a take-home essay on infrastructure finance.

4 Written group assessments                        30 %         due 06.10.2019
1 Paper/Case presentation (group):              30 %         see schedule
1 Final take-home essay (individual):          40 %         due 06.10.2019
In class contribution (bonus points)             10%         throughout course

Final Essay:

In the final essay students are required reflect on the case documented in the movie and apply knowledge from the course to the case. Students are free to choose a specific aspect (e.g. political risk, ownership structure, obsolescing bargaining), event (e.g. IPO), entity (e.g. the role of investors) or any other observation (e.g. ecological & social impact of infrastructure investments) that they made during the documentary as a focus of their essay. The only requirement is that students use academic theories and literature. The structure of the essay should broadly follow the following chapters.

1. Problem statement and definition of research question

2. Theoretical assessment of the problem (phenomenon)

3. Empirical evidence and academic literature

4. Application of theory and literature on the course

5. Conclusion

Students must comply with requirements of scientific publications (i.e. citation and plagiarism).

The final essay should be 5-6 pages (excluding title page, references, tables and graphs). Students have to hand in their essays online at learn@wu within 14 days of the last course session. Via e-mail for students without access.

Case study and scientific paper presentations

Students should…

· Summarize the paper/case

· For scientific papers, students should present statistical analysis. A detailed understanding of the methodology is not necessary but a critical discussion of variables, findings is required.

· Students should connect the findings of the paper to the slides and aim of the course

· Students should try to include content and examples from other sources (internet, scientific articles, press etc…)

· The presentation should conclude with the main takeaways for practice and research

….. In sum, students should provide a WELL-FOUNDED and PROFESSIONAL presentation that sparks interest and educates their colleagues.

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