Risk Management for Build, Operate and Transfer Infrastructure Project during Construction Stage

Ang, Koh Chim (2020) Risk Management for Build, Operate and Transfer Infrastructure Project during Construction Stage. Final Year Project (Bachelor), Tunku Abdul Rahman University College.

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Abstract

Construction projects are risky. However, the characteristics of the risk highly depend on the types of procurement adopted to manage the project. A Build-Operate-Transfer (BOT) project is recognized as one of the riskiest project schemes. The Malaysian government is increasingly using the Build-Operate-Transfer (BOT) model of project development across a number of sectors in its drive to privatize major public projects. It gives the government the benefit of more infrastructure projects being built especially construction of roads and highways, without the burden of additional public borrowing. Risk management used as a tool in managing projects so as to reduce risk particularly for projects that involved an enormous amount of cash. This paper aims to describe the level of awareness among relevant participants in the implementation of BOT projects in Malaysia and to identify the risks associated with Malaysia’s BOT infrastructure projects during construction period. Literature reviews on the concept of risk management and the features of BOT projects have been used to identify the risk factors in the implementation of BOT for infrastructure projects which include several risk categories such as macro level risks, meso level risk and micro level risk. The mitigation measures for source of risks were also discussed. Questionnaires were sent to client, project sponsors or concession companies, consultants and contractors to evaluate the ranking of these risks. The method and technique put forward by this paper would be used for risk management of BOT projects. And it is effective for improve risk management ability and reduce the risk in BOT projects. The main recommendation for this research is all parties should have same appreciation to identify the risks by working together in order to improve the effectiveness of the risk management.