Abstract :
The paper first discusses the characteristics of the risks within project financing. It is possible for us to predict the risks from their special roots, and the risks are transferable, separable and usable. In addition, some of the risks are mutually exclusive and their impact can be neutralized. These characteristics are somewhat different to those of the common funding methods and also provide the possibility to control and prevent them. Project financing always has several participants and complex structure. According to its complexity, from the project company´s point of view, this paper analyzes the functions and conflicts of main participants, which are given out in detail in a table. The major participants discussed include government, project sponsor, project company, creditors, suppliers of equipment/raw materials/energy, contractors, and purchasers of the products or users of the project. Based upon this, we put forward the principle of risk allocation, which emphasizes the combination of the three: risks, expectation and capability, opposite to the previous rule proposed in most of the other literature: risk should be allocated to the partner, who is most capable of controlling it
