The requirement for high-quality and reliable services is imposed by new technologies to which the industries have full access. The installed capacity of industrial companies is in various sectors exhausted. New projects are designed to expand the offer and meet the market requirements. Nevertheless, whether a world trend or not, neither investors nor companies are willing to commit their balance sheets in the context of such expansion. Project finance seems then to be the appropriate response to the marketplace needs for financing.
Project finance is an exercise of risk assessment, risk allocation and risk mitigation.
The switch from the infrastructure industry to industrial projects will not eliminate risks. Risk is the essence of business, and the task in business is to identify such risks and decide to whom they must be allocated, attempting, at the same time, to create mitigants. Volatility in prices of commodities and goods, and the absence of market benchmarks are good examples of identified risks. The adequacy of project finance as a means to financing industrial expansion may be challenged on the grounds of volatility of prices and the uncertainty of the ability of markets to absorb the production. The risk will always exist, but the parties tend to be less exposed than they are to the discretionary contents of the regulatory decisions in the infrastructure industry.