Financing cost depends on the allocation and management of the project risks. If these risks are properly managed and allocated, the cost of borrowing for the private sector can be very low. In any case, financing cost is just one component of a capital project. The total cost over the life-cycle of a project is a better indicator of the overall cost than simply focusing on the cost of borrowing. The PPP approach will be adopted if the total life-cycle costs and other benefits compare favourably with those expected under the traditional procurement mode.