The CAMRI Infrastructure Finance Initiative publishes thought leadership articles and op-eds periodically. It carries the perspectives, views and/or outlooks of various NUS Business School and CAMRI-associated authors as they relate to infrastructure finance with a particular emphasis on - or implications for - Asia.
Building uncertainty, flexibility into infrastructure megaprojects
Commentary by Assistant Professor Michel Alexandre Cardin (Industrial & Systems Engineering & Head of the Strategic Engineering Lab, NUS) and Practice Prof Joseph Cherian (Director, CAMRI) on new financial techniques infrastructure planners can use to make better decisions when developing projects.
The Business Times (Friday, 27 January 2017)
PPI Infrastructure Working Group - Summary of Discussions
by Pacific Pension & Investment Institute (25 October 2016)
CAMRI, a frequent partner to the Pacific Pension & Investment Institute’s Executive Seminar and Asia Roundtable Series, is pleased to announce that a summary of the discussion held by the PPI’s Infrastructure Working Group, which met on the sidelines of the PPI’s Asia Roundtable 2016 program in Hong Kong, is now available by clicking here.
The Pacific Pension & Investment Institute (PPI) is a U.S.-based, non-profit organization with a global network of pension and sovereign fund managers, endowments, consultants, asset managers and subject matter experts. The PPI’s Infrastructure Working Group, which convened in Hong Kong on 25 October 2016, comprises a group of 30 asset owners and influential stakeholders. This is just the first of a series of discussions by the PPI to:
a) Understand the roles, barriers and risks as viewed by project sponsors, asset owners, developers and investors
in the current infrastructure investment environment;
b) Support relevant investment platforms, whether currently in place or newly structured;
c) Unify a number of the fragmented approaches to the issues; and
d) Develop a set of recommendations that will be made available to PPI’s members so as to help move the
conversation on solving the infrastructure funding gap forward.
Prof Joseph Cherian, Director of CAMRI, served as the Moderator for the inaugural Infrastructure Working Group discussion session held in Hong Kong.
8th Wee Cho Yaw Singapore-China Finance and Banking Forum, Singapore, 14 July 2016
Financing Infrastructure and Promoting Free Trade
The year ahead will be challenging for the global economy with headwinds that will likely slow global trade. China’s weakening economy, higher interest rates in the US, plunging commodity prices coupled with global deflationary forces present a testing time for world leaders. To tackle these trends, world leaders have turned to two elements for global economic growth – freedom of cross-border trade and investment. Our distinguished speakers and panellists explored these complex and other pertinent issues including financing infrastructure and free trade pacts to invigorate the world economy.
The Potential for Shared-Use Infrastructure
By Ms Staci Warden, Executive Director, Center for Financial Markets at the Milken Institute (Monday, 11 January 2016, Presentation at the CAMRI Executive Roundtable Luncheon Series)
Rudiments of Infrastructure Finance and the Case for Singapore
by Ranjan Chakravarty and Joseph Cherian (September 2015)
Oh, behave! Why the AIIB can be a win for China and Asia
NUS Think Business article by Joseph Cherian July 3rd, 2015
Related commentary by Prof Joseph Cherian (Director, CAMRI) on how Singapore can play a key role in the Asian Infrastructure Investment Bank, which was adapted from his Think Business article, Oh, behave! Why the AIIB can be a win for China and Asia.
NetEase (Monday, 24 Aug 2015)
Caijing (Monday, 24 Aug 2015)
Optimal Extraction of Nonrenewable Resources when Costs Cumulate
By Joseph Cherian, Jay Patel and Ilya Khripko, In Project Flexibility, Agency, and Product Market Competition: New Developments in the Theory and Application of Real Options Analysis, (Oxford University Press, NY), Michael J. Brennan and Lenos Trigeorgis (Editors), 1999, Chapter 12, 224-253.
Advances in economic theory and optimal control methods have considerably improved the prescriptions for the extraction of exhaustible natural resources. The classic analyses proceeded under assumptions of price certainty with the emphasis on increasing marginal costs. Recent work, by using real options analysis, has addressed the considerable uncertainty in resource prices, but assumed a constant marginal cost of extraction. This paper frames and solves the nonrenewable resource extraction problem (in the context of a typical mine) that jointly accounts for price uncertainty as well as the dependence of extraction costs on the cumulative amount extracted and the extraction rate. We find that ignoring cumulating costs when determining extraction strategy can lead to significant loss of value. Our analysis also establishes the general tools to pursue, for instance, the optimal taxation policy of the natural resource sector that is of interest to many developing countries.