The record of infrastructure project financings provides ample evidence of shortcomings in skills and competencies, adequate project development preparation, and failures in project management. The idiosyncrasies and complexities of large infrastructure projects and the large number of participants account for some of the project failures. However, a number of project failures have their origin in the fragmentation of approach to project finance. That is, sometimes project finance is treated as a financial engineering problem, other times as an interweaving of contracts arrangement and at different times is considered mostly a project management issue. Each of these approaches focuses on subsets of specific issues of the broader discipline of new business development which incorporates elements of strategic planning, portfolio management, and financial and business planning intended to achieve competitive advantage.

Having learned from strategic planning, new business development projects, and project financing experiences, we recognized the need to treat project financing from a broader perspective than prevailing common practices. Why? Because Business Development groups view project financing a responsibility of Project Finance Organizations (PFOs) and PFOs had little knowledge of and interaction with Strategic Planning or Business Development functions. Discussions with project participants and results of a benchmarking study confirmed our assessment. Hence, our focus on integrating the knowledge, processes, and skills and competencies from the two disciplines to deliver significantly improved project financing solutions and make progress towards competitive advantage.

Besides the fragmented approach to infrastructure project finance in the current paradigm and the nonstellar record of project success, other reasons for undertaking the task of writing this book are:

• Treating project finance as an extension of strategic planning and new business development
• Misspelling myths about project financing that it is a matter of legal and financial engineering alone
• Sharing project experiences and findings of benchmarking studies of project financing practices conducted across different types of project participants
• Enhancing understanding of project teams of what is needed to make project finance an instrument to getting competitive advantage
• Addressing the inadequate development of project financing skills and competencies in different project participant organizations

Some typical misconceptions and wrong impressions the author has encountered are exemplified in the following actual statements by various project financing participants:

• The main success factors and drivers in project finance are the Sales and Engineering groups
• We count on relationships with customers to bring in new projects; we don't need project financing
• Strategic planning has nothing to do with project financing; why complicate things?
• There is no recourse to the developer in project finance, only to insuring parties
• Private placements are cheaper than loans to an infrastructure project
• The World Bank will give us their decision to participate in the project in 2–3 days (for an estimated $2.3 billion project)
• A sponsor does need a project finance organization; Accounting and Finance groups can handle project finance and if not, outsource the financing
• All infrastructure projects are financeable and if you can't bring financing to the project, we'll bring in investment bankers
• Project finance is nothing more than good contracts and low cost loans
• Technical superiority of proposals wins bids most of the time

The problematic segmentation of approach to project finance raised the question: Is there another, possibly better way of treating infrastructure project finance in a more holistic approach? Our research showed that there was nothing to guide a broader treatment of project financing. Yet, we believed that a practical, balanced, broader, and integrative perspective is needed which is more effective. Hence, our treatment of the subject is from a new business development approach which also incorporates the key elements of strategic and business planning with financial engineering, contractual agreement interweaving, and process and project management. However, this book does not claim to be a treatise on infrastructure project financing; it is an eclectic and holistic treatment of its important elements to make it more effective.

In addition to the fragmentation of the approach to project finance, raising funding becomes more complicated and difficult to manage when unharmonized participant interests enter the picture along with underdeveloped host country and credit impaired customer considerations. To simplify the presentation and make it easier to grasp the essence of project finance, the topic is treated from a sponsor or developer perspective doing projects in countries able to deliver on obligations to the project. On some occasions, when warranted, we deviate from this approach and incorporate other considerations and various participants' viewpoints.

Addressing infrastructure project finance from a new business development, strategic planning, portfolio management, and strategic forecasting elements approach combined with traditional project finance elements is a unique method. The reasons this approach is unique and of benefit to the readers is that it:

• Describes the skills and competencies, processes, analyses, and evaluations required to structure and finance effectively any type of project financing
• Applies knowledge of competitive analysis, forecasting, strategic and business planning, and business development to address project financing issues leading to competitive advantage
• Addresses organizational, project evaluation, process and project management, and funding sources and instrument issues while abstracting from nonessentials that take away attention from major success factors
• Pulls together key factors from each fragmented approach into an eclectic and integrated picture to discuss project finance while leaving the discussion of highly specialized and detailed parts to traditional treatments of the subject
• Helps identify reasons for project failures, key project success factors, and whether a competitive advantage to sponsors is obtainable through highly skilled, high performing PFOs
• Presents a well‐considered, balanced, and cost benefit/analysis‐based approach to project development, risk assessment and allocation, and project structuring and financing

The expectation is that readers will appreciate how the new business development approach is applied in any project to screen and evaluate opportunities and develop projects more effectively. That is, to bring projects from the prefeasibility study to financing closing quicker, address project stakeholder issues and harmonize interests, deliver winning financing proposals, and create profitable projects for all stakeholders. These are key elements in striving for and maintaining competitive advantage.