Bankable Construction Contracts in PPP Projects


Bankability as a whole is a very broad concept made up of various strands. A key strand is the construction contract(s) and is the focus of this article. Bankability considerations for construction contracts can vary between different types of project procurement methods. This article considers the topic from the perspective of a concession-based project, where a private sector party has been granted a concession to design, finance, construct and operate an infrastructure asset.

In most concession-based PPP projects, the construction contract is one of the most important agreements that will be entered into. The price to be paid to the contractor under the construction contract is generally the largest capital expenditure and as such is one of the key areas of focus for all stakeholders in PPP projects, not least the lenders

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