Case study of government initiatives for PRC's BOT power plant project

Abstract

The economic growth in the People's Republic of China (PRC) has resulted in more demand for basic infrastructure like roads, ports, and power generation facilities. To meet the development needs, the Chinese government has granted build-operate-transfer (BOT) concessions to attract foreign investment. A few state-approved pilot projects have been awarded since late 1996, the first of which was the Laibin B power project in the Guangxi province. This paper will discuss the government initiatives and guarantees provided for BOT projects in China based on the Laibin B Power Plant project in mitigating the risks. The lessons for investing in future similar BOT projects in China will be drawn.