Risk Management in Turkish BOT Transport Projects

Turkey, as a large developing country, has huge infrastructure needs but it lacks necessary financial resources mostly due to debt-service oriented state budget. Given this picture, public-private partnerships (PPPs) can play a vital role in attracting private finance to infrastructure projects. Among various PPP schemes, Turkish governments have extensively used Build-Operate-Transfer (BOT) model in a variety of sectors ranging from transportation to energy. While Turkey was one of the pioneering countries in BOT initiatives at the early 80s (even the term Build-Operate-Transfer was coined by Turgut Ozal, the former prime minister of Turkey), the past experience seems to be unsatisfactory in terms of both quantity and quality. In addition to adverse affects of political instability and successive economic crises, the mismanagement of project risks also hurt the applicability of BOT model in Turkey. As risk management is the key for a successful BOT project implementation, poor allocation of risks among public and private parties caused fruitless attempts and more importantly failures (mainly in energy sector) and these failures resulted in a general opposition against BOT projects and a reluctance in the government officials to appeal to such models. In this paper, in light of Turkish experience, risk allocation practices in BOT projects will be analyzed and poor allocation of risks will be underlined with respect to the specific characteristics of transportation sector.

• Supplemental Notes:
  • Risk Management in Turkish Build-Operate-Transfer Transport Projects: This is an alternate title. This paper was sponsored by TRB committee ABE10 Revenue and Finance.
• Corporate Authors:

  Transportation Research Board

  500 Fifth Street, NW
  Washington, DC  United States  20001
• Authors:
  • Ozcan, Ismail Cagri
• Conference:
  • Transportation Research Board 93rd Annual Meeting
  • Location: Washington DC
  • Date: 2014-1-12 to 2014-1-16
• Date: 2014

Language

• English

Media Info

• Media Type: Digital/other
• Features: Appendices; References;
• Pagination: 11p
• Monograph Title: TRB 93rd Annual Meeting Compendium of Papers

Subject/Index Terms

• TRT Terms: Build operate transfer; Developing countries; Financing; Infrastructure; Project management; Public private partnerships; Risk management
• Geographic Terms: Turkey
• Subject Areas: Administration and Management; Finance; Transportation (General); I10: Economics and Administration;

Filing Info

• Accession Number: 01519841
• Record Type: Publication
• Report/Paper Numbers: 14-2273
• Files: TRIS, TRB, ATRI
• Created Date: Mar 26 2014 10:11AM