CAN THE BENEFIT COST RATIO BE USED TO ANALYZE BUILD-OPERATE-TRANSFER PROJECTS?

The SLR (self-liquidation ratio) is a very important index for evaluating the financial ability of BOT projects. However, the SLR cannot be appropriately used to analyze the government cost and financial recovery for BOT projects due to its drawback. In addition, past studies did not pay much attention to the issue of the relationship between SLR and the royalty. The purpose of this paper is to modify the drawback of SLR by using the financial cash flow to model relationships among the PCCR (private construction cost ratio), GCCR (government construction cost ratio), royalty, and GFRR (government finance recovery ratio) for BOT projects. In addition, this study conducts a case study on the BOT concession of the Container Terminal in Taipei Port to find the solutions of PCCR, GCCR, royalty, and GFRR. Results of the case study show that the new BOT financial model could be used to interpret the financial characters of BOT projects.