Module 3.3: Cost Benefit Analysis and Environmental Assessment [3 HOURS]

It is very clear that the first stage in selecting projects is to ensure that the project is financially sound. The next stage in project evaluation and selection especially where there are both public and private goods like the telecommunication industry, the issue of cost benefit and environmental assessment becomes equally important. While a project may be financially sound; socially it may not be viable. Good Examples are telecommunication projects geared at improving rural access to information and communication while financially they may not be sound; socially and in the long run they may be viable and create positive returns to the economy.
To the telecommunication regulator this is an area of contention between an operator, investor and user. To the user access is the paramount motive, while to the operator and investor; the return is the main motive for undertaking a project. A regulator has a role of promoting investments hence protecting both the investor and the user. Knowledge of the issue will help the regulator to make informed decisions and protect interests of both user and investor.

Chapter Learning Objectives

• Understand social and financial costs and returns associated with the public and private projects.
• Understand the shadow pricing and externalities resulting from selecting projects.
• Assess the environmental impact of projects.

Chapter Learning Outcomes
At the end of this chapter, the learner will be able to identify the social and financial costs and returns relating to projects, and make a sound judgment in selecting a project.
Sessions to be covered include:

Session 1: Social and Financial Costs and Returns in ICT investments
Session 2: Shadow pricing and Externalities relating to ICT investments