Microcomputing in international investment negotiations

In international investment negotiations for mineral development,, computer support is important to the negotiating parties. Financial models are used to evaluate the economic, commercial and financial feasibility of the project. They also can play crucial roles in the refinancing and restructuring of existing operations. In negotiations, there are important intellectual and also social/psychological uses for such models. The central role of such models lies with their ability to caclulate the impact of major variables (such as prices, inflation, and interest rates) on the project’s financial and fiscal régime. Sensitivity analyses include the risk of cost overruns and the synergistic effects of variables deviating from forecasts. Computerized financial analysis allows for an instant calculation of the financial impact of major negotiating variables. Computer-generated displays can be very helpful in selling a proposal or tentative agreement to others.