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KDI - Korea Development Institute

KDI - Korea Development Institute



Public and Private Infrastructure Investment Management Center

The Public and Private Infrastructure Investment Management Center serves as a gatekeeper of public investment procurement by enhancing efficiency and transparency of public and private investment management and provides various consulting services and research to improve related policies and analytical tools.
Department of
Markets and

Government-Financed Projects


Preliminary Feasibility Study (PFS) was introduced in 1999 to encourage cautious approach to new large-scale projects by enhancing the efficiency of fiscal investment through verifying the feasibility of project in such aspects as its economic feasibility, policy analysis, investment priority, proper timing and financing methods by conducting general research on large-scale development projects.

Whereas a feasibility study focuses mainly on technical viability, PFS largely reviews economic and policy adequateness. Also, while a feasibility study is carried out by competent authorities, PFS is conducted by the Ministry of Economy and Finance.

The National Finance Act, Article 38 serves as sound legal ground for PFS and stipulates that projects requiring not only the approval of the Ministry of Economy and Finance but also the decision of the National Assembly must undergo inspection and verification in order to corroborate PFS, and that guidelines should be created to establish the criteria by which:

(1) the project will be selected
(2) an appropriate agency will be set up to conduct a PFS; and
(3) the method and procedures upon which the study will be based.

Management of Total Project Cost (TPCM), on the other hand, is based on Article 50 of the National Finance Act. The size, total project cost or period of a large-scale project set by the Presidential Decree should be agreed upon with the Minister of Economy and Finance. To revise the size, total cost or period of a project already agreed requires the same procedure.

The purpose of TPCM is to enhance the productivity of fiscal spending and the quality of facility construction by rationally adjusting and managing the total project cost of construction work executed with government funds according to the project implementation stages. Through managing project costs and changes in the size of a project throughout all the project stages, ranging from basic planning for a public investment project to the stages after the start of construction work, the TPCM system aims at overseeing the expansion of the project size by a competent ministry or agency. Types of TPCM include Reassessment Study of Feasibility, Reassessment of Project Plan, Reassessment of Demand Forecast, and Assessment of Design Modification.

Role of PIMAC

PIMAC is in charge of conducting the entire process of Preliminary Feasibility Study in accordance to the General Guideline for Preliminary Feasibility Study and sector-specific standard guidelines which are developed and revised by PIMAC. It examines efficiency and appropriateness of a project by reviewing its economic and policy feasibility as well as investment priorities, and optimal investment timing, among others. The role of PIMAC in the area of conventional procurement also include development and revision of policies and methodologies.

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