Hindawi

Discrete Dynamics in Nature and Society

Volume 2022, Article ID 2838913, 19 pages
https://doi.org/10.1155/2022/2838913

Research Article
Sustainable Financing Model considering Project Risk

Hossein Lolagari,1 Amir Daneshvar ,2 Mahdi Madanchi Zaj,3

and Fereydon Rahnamay Roodposhti4
1
Department of Financial Management, Science and Research Branch, Islamic Azad University, Tehran, Iran
2
Department of Information Technology Management, Electronic Branch, Islamic Azad University, Tehran, Iran
3
Department of Financial Management, Electronic Branch, Islamic Azad University, Tehran, Iran
4
Department of Accounting, Science and Research Branch, Islamic Azad University, Tehran, Iran

Correspondence should be addressed to Amir Daneshvar; [email protected]

Received 14 May 2022; Revised 20 July 2022; Accepted 1 August 2022; Published 7 September 2022

Academic Editor: Peiman Ghasemi

Copyright © 2022 Hossein Lolagari et al. This is an open access article distributed under the Creative Commons Attribution
License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is
properly cited.

Implementing various projects in each country leads to the development of that country. The necessity of implementing any project is
to finance that project through different methods. In this regard, the cost of financing projects, determining the amount of financing
from each technique, and the risk of financing projects are among the things that have caused problems for managers and decision
makers. This study presents a new sustainable financing model for international projects in Iran. The main objectives are to minimize
the financing cost and risk of funding the projects. Based on the proposed conceptual model based on fuzzy hierarchy analysis, it was
observed that Iran’s economic conditions, with a weight coefficient of 0.34, have the highest risk in financing projects. Therefore, a
two-objective model was designed by determining the weighting coefficients to reduce costs and financing risks. Additionally, the
epsilon constraint methods and NSGA II algorithm were used. Comparative results between the two algorithms show that financing
projects must be changed to reduce the risk of sustainable financing of international projects, which can lead to an increase in the total
cost of financing projects. On the other hand, it was observed that the NSGA II algorithm obtained 32 efficient answers (a
combination of how projects are financed). Each of the received answers has advantages over the other solutions obtained. The
epsilon constraint method also brought 11 efficient answers, demonstrating that the domestic capital market can provide 54.89% of
the deficit budget of the country’s international projects. Furthermore, 44.81% of the project deficit budget can be financed from a
foreign bank loan source, and only 0.2% of the budget can be funded through the company’s internal resources.

1. Introduction led to government officials’ attention to financing. The needed

funds can be provided with government support and funding
Financing and preparing the necessary executive budget to for several projects. However, in infrastructural and interna-
carry out infrastructure projects and exploiting the relevant tional projects of the country that cannot be fully financed by
products and services has been a critical challenge in devel- the government (such as oil, gas, and petrochemical industries),
oping countries [1]. Due to the particular condition of de- there is a basic need for the presence of foreign investors and
veloping countries and financial crises, it is impossible to using foreign banks and institutions’ facilities [3]. Project fi-
provide the necessary capital to implement international nancing differs from traditional types of financing because the
projects. Thus, choosing the appropriate national financing financier looks at the assets and revenues of the project to
method taking into account the financing risks of international provide the loan. Project finance greatly minimizes risk to the
projects such as sanctions, changes in exchange rates, and so on sponsoring company, as compared to traditional corporate
is an important issue [2]. In many global projects, the high finance, because the lender relies only on the project revenue to
volume of capital required and the high sensitivity of the repay the loan and cannot pursue the sponsoring company’s
project in terms of political, economic, and security issues have assets in the case of default [4].
2 Discrete Dynamics in Nature and Society

Considering the structure of the countries’ public sectors of projects is done either through domestic resources or
and the existing problems and damages, we are witnessing through the absorption of foreign resources [13]. In each of
the prolongation and inefficient implementation of projects these methods, there are different options that the project
in various sectors for reasons such as administrative and employer finances his project according to his needs from
government bureaucracy, which in turn leads to a decrease one of these two methods [14]. There are various financing
in quality and service delivery. On the other hand, the methods for each international project with different risks,
government’s budget and financial resources do not fully including the cost of their unique capital. Therefore, fi-
provide enough investment in these sectors [5]. Meanwhile, nancing for each project will include two indicators of
the existing potential and capacities of the countries make capital cost and related risk.
the need to take advantage of the expertise and innovation of Consequently, it is necessary to provide a sustainable
the private sector regarding the implementation of inter- financing model for international projects, considering
national projects more than ever. The experiences of dif- the risks and costs of capital. Accordingly, the primary
ferent countries of the world indicate that factors such as purpose of the proposed research is to present a two-
governments’ limited financial and budgetary resources to objective mathematical model with the objectives of re-
provide international projects and the high demand in the ducing the cost of capital (financing) and reducing the
field of investment in these projects have prompted coun- risk of financing international projects. Therefore, a set of
tries to put all their efforts. Creating a suitable competitive international projects with different funding sources
environment for their activities, these efforts have crystal- should minimize the total cost of funding international
lized in the form of public-private partnerships and have projects; however, this can increase the financing risks.
accelerated the economic development process of countries Therefore, the creation of a mathematical model for
[6]. Finding a way to fund international projects is one of the decision-making, including the allocation of financial
first steps in ensuring that a project is completed [7]. In resources to each international project and the prioriti-
choosing the appropriate financing method in the feasibility zation of funding, is investigated. The result of presenting
stage of the project, one should pay attention to all the cases this model will be the achievement of an efficient set of
and demands of different sectors involved in the project answers from funding international projects. The concept
(such as project size, project-related industry, contractors, of capital cost is based on the assumption that the
buyers, suppliers, lending banks, and risk issues). Then, company’s goal is to maximize shareholder wealth.
mathematical models are applied to determine the best Virtual units must accept designs that are at least more
method or methods of investment, considering the reduc- cost-effective than the cost of capital for that unit. In
tion of costs and risks. It should be noted that the structure other words, the cost of capital is the minimum rate of
used to finance a project in a country may not be effective return for new investments. The capital cost, called the
everywhere due to differences in laws and conditions in required return, represents an investor’s opportunity cost
different countries. The critical point in choosing the proper to invest in a company or project.
financing method according to each project and country’s The main purpose of this article is to design a multi-ob-
requirements is the project’s amount [8, 9]. jective mathematical model based on reducing capital costs and
The most important and effective solution to achieve reducing the risk of financing international projects. The
development goals in a country is the existence of a robust mathematical model is such that it can provide the source of
economic structure with an active financial market. Due to financing for a series of international projects in Iran in a way
the lack of funding and financial savings in most developing that has the lowest capital cost and the lowest financing risk.
countries, domestic facilities in such countries are not Therefore, for this, a set of methods for determining the
enough to raise capital to achieve development goals and project’s financial risk such as FAHP and accurate methods
national and international projects. Therefore, most of these such as epsilon limit (EP) and meta-battery algorithms such as
countries have to have the required capital deficit. Therefore, NSGA II have been considered. Solution methods provide
most of these countries have to have the required capital managers with effective solutions (investment options) so that
deficit to provide themselves from external sources, and thus they can choose the most appropriate option based on budget,
the tendency to attract external financial resources is formed. political, investment, and other restrictions.
In financing the project, it can be done according to the type Therefore, the main features of the article can be sum-
of project and the relevant industry, the amount of money marized as follows:
and the time required for the project, the conditions of the (i) Considering both the cost of capital and risk in
country, the amount of the project in terms of political, financing international projects.
economic and existing laws, the risks of each financing, and
(ii) Providing a combined model of fuzzy hierarchical
the level of sensitivity of the project in that country various
analysis and mathematical planning model in fi-
methods for financing international projects were consid-
nancing international projects.
ered [10, 11, 12].
Types of financing include short-term or long-term (iii) Use of epsilon constraint method and NSGA II
loans, investment participation, conditional investment, sale algorithm in solving the problem of financing in-
of company shares, issuance of bonds (the last two methods ternational projects.
are possible for large companies, of course), and so on. (iv) Prioritization and weighting of financing risks based
Whether related to the public or private sector, the financing on the fuzzy hierarchical analysis method.
Discrete Dynamics in Nature and Society 3

This paper’s structure is as follows. In the second part, is the long-term construction period and the second is the
the research background is stated, the research gap is de- high cost of implementation. They stated that the use of
termined, and finally, the research innovations are discussed. Islamic financial innovations based on Islamic contracts can
The third part presents a two-objective mathematical model answer many of these needs. Kumar et al. [19] investigated
for financing sustainable projects. Additionally, this section the financial risk associated with highway infrastructure
offers two-objective model solution methods and evaluation projects by identifying parameters such as traffic flow and
indicators of solution methods. In the fourth section, a case project cost and modeled the risk by analyzing real-world
study in Iran (international projects) is studied, and the PPP-based highway projects in India. They presented the
mathematical model results are presented. The fifth section tool of net present value (NPV) model and Monte Carlo
concludes the findings and proposes future research simulation considering probability distributions for various
proposals. input parameters and uncertainty associated with NPV. Li
et al. [20] examined the financing risk of high-tech com-
2. Literature Review panies. They offered several ways to better address financing
risks from the perspective of firms, financial markets, and
The significant and direct relationship between corporate government regulations. Bluhm et al. [21] analyzed the ef-
financing and its size has been investigated in several studies. fects of these projects on the spatial distribution of economic
The internal variables affecting the financing of small and activity in the host countries by examining projects geo-
medium enterprises are their profitability and age. Profit- graphically covered by the Chinese government in 138
ability is a measure of the efficiency and effectiveness of the countries between 2000 and 2014. The results show that
firm in using the assets owned. The hierarchical theory states Chinese investments in “bonded infrastructure” create
that firms with more profitable weapons are less inclined to positive economic overflows that lead to an equal distri-
obtain facilities because they have more accumulated profits. bution of economic activities in the areas where they are
The higher profit margin of the firm makes the banks more implemented. Barroco and Herrera [22] examined the se-
willing to increase the facilities. lection factors of financing methods in the Philippines. They
On the other hand, the longer the company’s payment showed that project financing could raise the capital needed
period is, the more banks trust in the return of high-quality for renewable energy in developing countries. Wu et al. [23]
facilities, and the more attractive the company is to provide assessed the financing risk of rural tourism projects and their
facilities for banks. In addition, startups often need a lot of comparative analysis using Vicker’s multi-criteria decision-
external financing to maintain their internal resources in the making method with fuzzy numbers. They stated that using
early years of operation and are always trying to obtain the proposed method could fully consider the limited ra-
facilities. Ebrahimnejad et al. [15] identified the most critical tionality of decision makers in an actual decision-making
risks based on BOT financing of power plant projects. Then, action. This study shows that from the perspective of fi-
the risk assessment in funding is done by the BOT method nancial providers, higher facilities for small companies are
and is prioritized based on the fuzzy LINMAP method. The associated with more uncertainty than direct social loans
proposed framework was implemented in a real case study. paid. Ahmadabadi and Heravi [24] investigated the impact
Yousefi et al. [16] prioritized the financing methods used in of essential success factors on PPP projects based on the
the Tehran Renovation Organization through a hierarchical developed PLS-SEM model. The results showed that the
analysis method. In addition to prioritizing financing private sector’s ability directly impacts the project’s success
methods, this paper performed a sensitivity analysis to during the construction period, and the government’s ability
determine the impact of weight changes on the prioritization is very effective in the operation phase of the project. In
of various projects. Nourzai et al. [14] examined the effect of addition, the review of case studies according to the in-
criteria on the financing method of the railway project using troduced model showed a transparent bidding process, risk
a questionnaire. They conducted their evaluation through allocation, and good participation of CSFs in PPP projects in
partnership financing (BOO, BOT, and DBFO). Finally, the developing countries.
prioritization of railway funding projects was done through Tan et al. [25] presented optimization models for in-
the AHP method. Mehr Ara et al. [17] sought to find the novative financing in the field of green energy technology.
most appropriate method of financing Mahan Air. They They presented two mathematical models. In the first model,
surveyed 15 experts to prioritize financing methods using the optimization of budget allocation to a set of independent
fuzzy hierarchical analysis. The results showed that in the innovative projects has been addressed, and in the second
financing of projects of international business companies model, the allocation of limited project budget has been
from internal sources: loans, equity participation, install- optimized to maximize the SRL of an emerging technology
ment sales, leasing, internal supply line, participation in system. Noring [26] evaluated the effectiveness of different
profits and external financial sources, external financing line, public/private consultation models for urban regeneration
construction, operation, transfer, and capital. Partnerships and land value absorption with the aim of maximizing
are in order of importance. Besides, closer inspection returns. He introduced the PAC model for urban devel-
showed a significant relationship between different financing opment and infrastructure financing, which is a combina-
methods and project success. tion of public and private models. This method has been
Manzoor et al. [18] examined different models of public used in the development of the city and port of Copenhagen
project financing based on two important features. The first in the extensive urban reconstruction and the city’s subway
4 Discrete Dynamics in Nature and Society

system. In a quasi-natural experimental study, Li and Zhong the lack of forecasting the process of using the contract in the
[27] identified the cause-and-effect relationship between law on tenders, the long time to finance the contract, and
economic policy uncertainty and decision making on cor- sometimes the inability of the contractor to finance zero to
porate investment financing. They have designed a model one hundred projects. As a result, despite all its benefits, it is
using structural reform and an input-output flowchart. The not only faced with a positive approach from contractors and
empirical results of this study show that the uncertainty of employers, rather it ranks first among the most challenging
economic policies significantly hinders real investment and service and investment contracts compared to other stan-
reduces the net debt issuance to private enterprises. Man- dard commercial contracts.
zoor and Norouzi [28] focused on financing upstream Morea and Gebennini [34] introduced a new model of
Iranian oil and gas projects using cryptocurrencies in project financing and environmental efficiency for sus-
conventional contract models. As a result, using this method tainable investment. Egor [35] investigated the financing
improves the efficiency of traditional oil and gas contract problems of large infrastructure projects in Russia and
financing methods. Bahrololoum and Bakhtiar [29] dis- China and proposed ways to improve and develop fi-
cussed the most important criteria and efficient methods of nancing in Russia. In this research, scientific knowledge
financing thermal power plants in Iran. They prioritized methods such as induction, inference, analysis, synthesis,
efficient financing methods from 18 experts working in generalization, and description were used. Gamel et al. [36]
thermal power plant financing to collect information using deepened the understanding of people’s motives for
the AHP method. The results show that financing through investing in wind energy projects. Further analysis shows
Islamic bonds (SUKUK) has the highest efficiency level that subjective norms, perceived behavioral control, con-
among financing methods. The use of financing sources is sumption characteristics, and investor experience have a
the most critical criterion in choosing the most efficient statistically significant effect on wind energy investment
financing for these projects in Iran. Hosseini and Ismailpour goals. However, attitude towards wind energy investments
Moghadam [30] examined defense financing models is not a significant predictor of investment intention.
through capital markets, considering the European Union Khojimamatovich et al. [37] conducted a case study in
and the United States as case studies. They proposed a fi- Uzbekistan for financing macro-level activities and projects
nancing model for Iran’s defense-related industries and and outlined the country’s current situation and invest-
services through capital markets. The model estimation ment prospects. Therefore, they provided recommenda-
results show that larger companies have successfully tions on the feasibility of a system of financing investment
attracted financial resources by issuing shares or accumu- activities in Uzbekistan. Maslov [38] identified and ana-
lating profits. On the other hand, companies with more lyzed the prerequisites for sharing benefits and costs in
profitability have been more successful in financing by determining the effectiveness of financing public-private
obtaining debt. partnership projects. He used economic and mathematical
Adekoya et al. [31] compared the efficiency of US green modeling methods to calculate the effectiveness of public-
and conventional bond markets to achieve environmental private partnership projects. He stated that the systematic
sustainability from a financial perspective. Using the frac- reinvestment of personal funds causes a gradual increase in
tional integration technique, they showed that the entire income. Pranata et al. [39] investigated the use of
green and conventional bond markets are still inefficient, crowdfunding as an alternative source of financing infra-
suggesting that green and conventional investors can earn structure projects, especially in developing European and
more by anticipating future bond price trends. There is also American countries. They compared 4 crowdfunding
evidence that the green bond market continues to be more platforms (Oneplanetcrowd, Convergence Finance, Cit-
volatile during the global health crisis than during the global izenergy, and Infrashares) in Europe and the US that
financial crisis. Ari and Koc [32] introduced alternative successfully raised capital for infrastructure projects.
equity-based financing models. They did this by developing Tavakolan and Nikoukar [40] presented a hybrid meta-
an agent-based model and scenario-based computer simu- heuristic algorithm to solve a multi-objective optimization
lations for financing solar power plants. Simulation results problem in planning and financing construction projects.
show that the proposed model significantly reduces wealth The main purpose of this model is to provide a Pareto chart
inequality for the given case study, while conventional debt- that shows the trade-off between project duration and fi-
based financing models increase inequality. Bahadoran- nancing cost by considering different durations for each
Baghbaderani and Mohamadi [33] legally examined the project activity and different financing options.
most critical restrictions on foreign investment and project In Table 1, the research gap among the most important
financing in implementing these contracts. They ranked the articles published in the field of project financing in different
position of these restrictions in the preevaluation of EPCF countries has been examined.
contracts compared to other conventional commercial By reviewing the relevant literature, it can be seen that a
contracts in Iran. This study represents the result of surveys small number of research studies have provided mathe-
conducted on 60 contracting entities and employers with matical models for financing projects by considering risk.
experience in EPCF contracts. The results illustrated that Since risk is considered as an important factor in the fi-
contractors and employers in Iran did not welcome these nancing of international projects of any country in line with
contracts. The reasons are the lack of EPCF matching its development, in this article, the FAHP method has been
contracts by the management and planning organization, used to weight and prioritize risks. Also, a two-objective
Discrete Dynamics in Nature and Society 5

Table 1: Examining the research gap in the field of project financing.

Mathematical
# Ref Objective Uncertainty Risk Solution approach Case study
model
The Bank for Housing
Eyiah and Cook Financing small and medium- Survey and
— — — and Construction (BHC)
[41] scale contractors questionnaire
in Ghana
Singh and Identifying the various aspects of PPP road projects in
— — ✓ Questionnaire
Kalidindi [42] PPP road projects India
Estimating the investment
Interview and Rural energy Projects in
Ohiare [43] requirements and financing ✓ — —
questionnaire Nigeria
options for rural electrification
Beijing subway line 4
Identification of project financing Content analysis
Chen et al. [44] — — ✓ and Indian Dabhol
risks AHP
Power Project
Renewable energy
Barroco and Clearing barriers to project Content analysis
— ✓ — projects in the
Herrera [22] finance for renewable energy PLS-SEM
Philippines
Investigation of the interrelation
Ahmadabadi and
between success criteria (SC) and — — ✓ PLS-SEM Highway projects in Iran
Heravi [24]
critical success factors (CSFs)
Two large-scale
Financing of renewable energy
Klagge et al. [7] — — ✓ Statistical analysis renewable energy
projects
projects in Kenya
Yemelyanov et al. Reduction of financing Natural gas in Western
✓ — — Statistical analysis
[45] investment costs Ukraine
Renewable energy
Reduction of financing Survey and impact
Roth et al. [46] ✓ — — projects in the European
investment costs analysis
Union
Spasenic et al. Risk assessment of financing A small hydropower
— ✓ ✓ FMEA-DST
[47] renewable energy projects plant project in Serbia
Tavakolan and Time and total cost of financing Construction project in
✓ ✓ NSGA II
Nikoukar [40] international projects Iran
Investigating various financing Infrastructure projects in
Pranata et al. [39] — — — Statistical analysis
methods Europe and America
FAHP Epsilon
Cost-scheduling of financing International projects in
This paper ✓ ✓ ✓ constraint NSGA
international projects Iran
II

model is presented by reducing financing cost and reducing international projects should be funded according to each
financing risk, and EP and NSGA II methods are used to project’s net profit, tax rate, current debts, etc., based on
achieve different decision options. various available resources.
Therefore, the two-objective model of sustainable fi-
3. Presenting a Mathematical Model for nancing of international projects can be modeled to reduce
Financing International Projects financing and reduce the financing risk of international
projects based on the following assumptions:
Due to the particular situation of developing countries and
the relevant financial crises, preparation of the necessary (i) Projects are considered that are seeking funding and
executive budget to carry out infrastructure projects besides facing budget deficits.
exploiting the products and services has been faced with (ii) Projects can be financed in three ways (internal
different challenges. Thus, choosing the appropriate national resources of the company, capital increase through
financing method considering the international projects’ the parent company (internal capital market), and
risks are essential issues (such as lack of investment in the the use of bank loans (external resources)).
design stage, the existing historical background, political and (iii) Financing is done only for working capital and
international conflicts, Iran’s economic situation, elections, purchase of fixed assets.
sanctions against Iran, world economic conditions, limited
(iv) The maximum use of each funding source is known.
resources, government goals, and so on). Accordingly, this
section presents a two-objective model for sustainable fi- (v) The expected profit per share is considered in
nancing of international projects to reduce financing and mathematical modeling.
international projects’ financing risk. Consequently, (vi) The risk of project financing is uncertain.
6 Discrete Dynamics in Nature and Society

Based on the assumptions mentioned above, the Therefore, in this regard, after determining the share of
financing model can be expressed by defining the each financing method, the corresponding financing cost
following symbols: will be applied.
Sets Equation (2) refers to the entire risk of international
funding projects. In this regard, each financing type has a
I: collection of international projects i � {1, 2, . . . , I}
unique risk level.
J: funding sources j � {1, 2, . . . , J} Therefore, in this regard, based on the financing amount
K: inter-unit loan set and dividend distribution to of each international project and the risk weight determined
the parent company k � {1, 2, . . . , K} by the FAHP method, the overall risk of project financing is
R: project risk set r � {1, 2, . . . , R} determined.
Equation (3) demonstrates the supply of each of the
Parameters international projects. Equation (4) ensures that each
ai : profit before interest and project tax i project’s minimum earnings per share are estimated. Also,
bi : net project profit i equation (5) shows the maximum capacity to use each fi-
cj : the capital cost of financing source j nancing source for each project. According to these rela-
tions, the international projects’ sustainable financing is
T: tax rate based on the two-objective model of total financing cost and
hi : amortization of project i during the planning total financing risk.
period In this regard, to determine the weight of the impact of
Ii : current debt plus the current portion of project each risk in the mathematical model, the fuzzy hierarchy
long-term debt i during the planning period analysis method has been used by presenting a conceptual
di : dividends paid on project i per share during the model as described in Figure 1.
planning period Given the various steps to achieve the results, the
flowchart in Figure 2 shows how to finance international
wi : the amount required for project i to be financed projects based on the mathematical model and the con-
vi : minimum earnings per share for the project i ceptual model presented.
ni : number of project shares i The fuzzy hierarchical analysis method for prioritizing
and weighting the project risks, the epsilon constraint
pij : maximum capacity to use source j for unit i
method, and the NSGA II algorithm for solving the two-
δrj : risk weight r in financing from source j objective mathematical model and forming the Pareto front
Decision variables are discussed.
Xij : the amount of financing unit i from source j
Yik : the amount of cash flow output of unit i in 4. Methodology
option k. In this part of the article, the method of fuzzy hierarchical
The mathematical equations of the two-objective model analysis to determine the weight coefficients of risks of each
of sustainable financing in international projects are project based on the conceptual model of Figure 2 is first
expressed as described.
I J
min Z1 � 􏽘 􏽘 cj .Xij , (1)
i�1 j�1 4.1. Fuzzy Hierarchical Analysis. In many real-world issues,
human judgments and perceptions are not definitive. The theory
I J R of fuzzy sets was proposed in 1965 to address the uncertainty of
min Z2 � 􏽘 􏽘 􏽘 δrj .Xij , (2) decisions. Fuzzy sets are sets with membership degrees that are
i�1 j�1 r�1
defined. A triangular fuzzy number can be defined as
􏽥 � (l, m, u) whose membership functions are given by
A
J K
s.t.: bi + hi + Ii − di + 􏽘 Xij − 􏽘 Yik � wi , ∀i ∈ I, (3) ⎪
⎧ x− l
⎪
⎪ , l ≤ x ≤ m,
j�1 k�1 ⎪
⎪ m − l
⎪
⎪
⎪
⎪
⎨
􏼐ai − 􏽐Jj�1 cj .Xij 􏼑/1 − T μA􏽥 (x) � ⎪ u − x (7)
≥ vi , ∀i ∈ I, (4) ⎪
⎪ , m ≤ x ≤ u,
ni ⎪
⎪ u− m
⎪
⎪
⎪
⎪
⎩
Xij ≤ pij , ∀i ∈ I, j ∈ J, (5) 0, otherwise,
in which l and u are the lower and upper bounds of the fuzzy
Xij , Yik ≥ 0, ∀i ∈ I, j ∈ J, k ∈ K. (6) numbers A 􏽥 and m, respectively, are its middle values. If we
assume that there are two fuzzy numbers A 􏽦1 � (l1 , m1 , u1 )
Equation (1) shows the total cost of financing interna- 􏽦
and A2 � (l2 , m2 , u2 ), then the following operators can be
tional projects.
defined as
Discrete Dynamics in Nature and Society 7

Financing of international

Objective
projects

Index
Financing .. Financing Financing Financing
risk n . risk 3 risk 2 risk 1

Option
Source of ..
Source of Source of
financing m .
financing 2 financing 1

Figure 1: Conceptual model of hierarchical analysis of financing international projects.

Provide a two-objective mathematical model

to reduce the total cost of financing and the
total risk of financing

Designing a conceptual model to determine Using expert opinions based

the risk weighting coefficients of financing on a hierarchical analysis
each project model with fuzzy data

Collection of key issue data based on

international projects with budget deficits

Adjust the parameter of

NSGA II algorithm to
Solving a two-objective model using the increase its efficiency and
collected data and weighting coefficients of define comparative
the AHP model by the Epsilon constraint indicators such as NPF, MSI,
method and the NSGA II algorithm SM and CPU-time

Analysis of results (various efficient

solutions) including prioritization of risks,
prioritization of funding sources and how to
finance each project

Figure 2: Flowchart of how to achieve the financing of sustainable projects.

8 Discrete Dynamics in Nature and Society

􏽦1 ⊕A
A 􏽦2 � l1 , m1 , u1 􏼁 + l2 , m2 , u2 􏼁 � l1 + l2 , m1 + m2 , u1 + u2 􏼁,

􏽦1 ⊗ A
A 􏽦2 � l1 , m1 , u1 􏼁 ⊗ l2 , m2 , u2 􏼁 � l1 × l2 , m1 × m2 , u1 × u2 􏼁,

􏽦1 − A
A 􏽦2 � l1 , m1 , u1 􏼁,
(8)
􏽦1
A l ,m ,u 􏼁 l m u
� 1 1 1 � 􏼠 1 , 1 , 1 􏼡,
􏽦
A2 l2 , m2 , u2 􏼁 l2 m 2 u 2

􏽦1 − 1 − 1 1 1 1
A � l1 , m1 , u1 􏼁 � 􏼠 , , 􏼡.
l1 m1 u1

Hierarchy analysis is a decision-making method based in which 􏽥ri represents the geometric mean of the fuzzy
on expert opinions used to prioritize and weight the criteria numbers and w 􏽥 i the weight of each criterion.
and options of the problem. This method can determine the Equation (13) is used to control the fuzzy weight ob-
importance of each criterion based on pairwise comparisons tained for each criterion, and equation (14) is employed to
between criteria through quantitative and qualitative eval- normalize the weight of the criteria.
uation. Due to the uncertainty of data and comparisons, this
lwi + mwi + uwi 􏼁
method can deal with fuzzy and uncertain numbers, which wi � , (13)
can be achieved based on the following steps: 3

Step 1: a pair matrix is created according to equation (9) wr � wi 􏽐ni�1 wi . (14)

in which the experts have made their pair comparisons.
Table 2 shows that the nine-spectrum scale has been In this way, the weight of each risk in sustainable fi-
used to perform the quantification method. nancing of international projects is obtained based on ex-
perts’ opinions. After determining the weight of the risks and
1 a􏽥12 · · · a􏽥1n the collected data, the two-objective model of solution and
⎜
⎛
⎜
⎜ ⎟
⎞
⎟
⎟ the efficient solutions obtained should be examined.
⎜ a􏽥21 1 · · · a􏽥2n ⎟
⎟
􏽥 �⎜
A ⎜
⎜
⎜
⎜
⎟
⎟
⎟
⎟ . (9) Therefore, epsilon constraint and NSGA II algorithm
⎜
⎜
⎝ ···
⎜ ··· ⋱ ··· ⎟ ⎟
⎟
⎠ methods are proposed to solve the two-objective model
a􏽥m1 a􏽥m2 · · · 1 described in each of the following methods.

Step 2: the opinions of different experts are collected

based on equation (10), written as 4.2. Epsilon Constraint Method. The extended epsilon con-
1/K
straint method is for solving multi-objective problems.
K Despite having many advantages over other methods, such
⎝􏽙 l ⎞
lij � ⎛ ⎠ ,
ijk as the weighting method, it should be considered in some
k�1
cases: (1) calculating the range of objective functions in the
1/K
K efficient set, (2) ensuring the efficiency of the obtained
mij � ⎝
⎛􏽙 mijk ⎠
⎞ , (10) answer, and (3) increasing time. Solve the problem if there
k�1 are more than two-objective functions. To overcome the
K
1/K weaknesses of the epsilon constraint method, the amplified
⎝􏽙 u ⎞
uij � ⎛ ⎠ , epsilon constraint method uses the lexicographic method to
ijk
k�1 calculate the values of the final result table for each objective
function. It converts the constraints related to the sub-
where K is the total number of experts. objective functions to the equation by auxiliary variables. In
Step 3: the fuzzy weight matrix is calculated. To this lexicography optimization, objective functions are ranked by
end, first, the fuzzy comparison values are computed as the decision maker based on importance. In this method,
first, the objective function is optimized with priority with La
as a single objective.
1/n In this method, it is assumed that f1 (x) is the objective
n
⎝􏽙 a􏽥 ⎞ ⎠ . function with the highest priority, and its optimal answer is
􏽥ri � ⎛ (11)
ij
j�1
equal to f∗1 . To optimize the second objective function by
adding the constraint f1 (x) � f∗1 , the optimal solution of
Then, the fuzzy weights of each criterion are defined by the first objective function is maintained, and the value f∗2 is
calculated to optimize the objective function with the next
􏽥 i � 􏽥ri ⊗ 􏽥r1 ⊕􏽥r2 ⊕􏽥r3 ⊕ · · · 􏽥rn 􏼁− 1 ,
w (12) priority. The epsilon method model of the enhanced
Discrete Dynamics in Nature and Society 9

Table 2: Nine spectra of fuzzy numbers.

Description Equivalent fuzzy priorities Reverse fuzzy preferences
Equal importance (1, 1, 1) (1/1, 1/1, 1/1)
Identical to relatively important (1, 2, 3) (1/3, 1/2, 1/1)
Relatively more important (2, 3, 4) (1/4, 1/3, 1/2)
Relatively crucial to very important (3, 4, 5) (1/5, 1/4, 1/3)
Very important (4, 5, 6) (1/6, 1/5, 1/4)
Very important to very much (5, 6, 7) (1/7, 1/6, 1/5)
Very important (6, 7, 8) (1/8, 1/7, 1/6)
Too much to be important (7, 8, 9) (1/9, 1/18, 1/7)
More important (8, 9, 10) (1/10, 1/9, 1/8)

constraint to solve the project financing model can be Arranging non-defeats is a procedure to achieve better
presented as follows: answers, and the mechanism of diversity also seeks to
maintain diversity and breadth in these answers. In this
s
Min Z1 + δ􏼠 2 􏼡, algorithm, this is done by swarming distance in this way.
r2 (15) The smaller the swarming length of an answer, the greater
the density of answers around it. For the next step, the
s.t.: Z2 − s2 � ε2 Eqs(3 − 6), solutions in the area with less density or, in other words,
with more congestion distance are selected to increase the
in which r2 refers to the domain of the objective functions, ϵ2
diversity and dispersion of the obtained answers. Using
represents the answers obtained from each iteration, and δ is
congestion spacing in NSGA II aims to create variety in
a small positive number.
population responses and indicate the density of responses
alongside a specific response. The swarm interval for the
4.3. The NSGA II Algorithm. One of the most efficient and ordered answers is obtained in ascending order and
well-known multi-objective optimization algorithms is the straightforward to set F as defined by the following
NSGA II genetic algorithm. This algorithm is one of the equation:
fastest and most powerful optimization algorithms, with less
operational complexity than other methods. It has a good C D􏼐X1 􏼑 � C D􏼐XS 􏼑 � ∞,
range in the change of objective functions and gives the
designer the freedom to choose the design he wants from the Z1 􏼐Xi+1 􏼑 − Z1 􏼐Xi− 1 􏼑⎥
optimized structures. C D􏼐Xi 􏼑 � ⎡⎢⎣ ⎤⎦
In NSGA II, the preservation of elitism and dispersion Z 1 􏼐 X S 􏼑 − Z1 􏼐 X 1 􏼑
are considered simultaneously. The selection of a new
population in each step of this method is based on the Z2 􏼐Xi+1 􏼑 − Z2 􏼐Xi− 1 􏼑⎥
principle of dominance. Using elitism and population + ⎡⎢⎣ ⎦⎤, i � 2, . . . , S − 1.
Z2 􏼐XS 􏼑 − Z2 􏼐X1 􏼑
ranking in each step of the solution selects the best-unde-
feated answers and goes to the next step. If there are two (16)
maximization objective functions f1 and f2 , then for the
In the above relation, C D(Xi ) is the amount of con-
two answers x and y, the answer x beats the answer y(x < y)
gestion distance for the answer Xi . After integrating the
if we have f1 (x) ≥ f1 (y) and f2 (x) ≥ f2 (y) or
parent-child population, the undefeated sorting is per-
f1 (x) > f1 (y) and f2 (x) > f2 (y). Additionally, to observe
formed, and steps 7 and 8, described below, are performed.
the proper distribution of the density of the answers in this
Based on step 10, the swarm distance criterion is used to
algorithm, a concept called congestion distance is used. To
create a subset of the last undefeated set due to the subse-
sort a population of size n based on non-defeat levels, each
quent increase in population size (Figure 3).
response is compared to all the other answers to determine if
that answer is defeated. Finally, there are several solutions, Step 1: create the initial population P0 of size N with
neither of which overcomes the other, so these solutions random answers and set t � 0.
form the first boundary of the invincible boundary. Step 2: if the stop condition is not met, return to Pt .
These answers are passed to set F1 . The answers in the
Step 3: using the binary selection operator, select N
first boundary are temporarily ignored to determine the next
parents from the population Pt .
boundaries’ answers, and the above process is repeated. This
time the answers are transferred to the F2 set and take Step 4: create a population Qt of size N by applying the
second place. This process continues for all the unanswered intersection and jump operators to the population Pt .
answers of the population. Step 5: set Rt � Pt ∪ Qt .
One of the evolutionary algorithm’s criteria to reach the Step 6: use the invincible ranking method to determine
optimal Pareto boundary is maintaining the variety and the Pareto Fi sets in Rt population.
breadth of the answers in the set of obtained solutions.
10 Discrete Dynamics in Nature and Society

Generate the first population Input Start

Decoding the population and

evaluting fitness value

Generation = 1

NO YES
Generation < N Using selection operator

Using arithmetic crosscover

Output operator

Combining the current Using blend crossover

population and offspring to operator
sort the new poluation
Stop
Using mutation operator

Generation = Generation + 1 Decoding the population and

evaluting fitness value

Figure 3: NSGA II algorithm pseudocode.

Step 7: set Pt+1 � ∅ and i � 1. following, the indicators for comparing the methods of
Step 8: until |Pt+1 | + |Fi | < N: solving the two-objective model of sustainable financing of
international projects are discussed.
(A) Add the answers to the set Fi to the population
Pt+1 .
(B) Put i � i + 1.
4.4. Comparison Indicators of Solution Methods. Each of the
Step 9: arrange Fi set answers in descending order of mentioned methods in solving the problem produces
congestion. different efficient answers. Therefore, to compare efficient
Step 10: size N − |Pt+1 | transfer from the first answers solutions, various indicators should be used. In this section,
Fi to the population Pt+1 . four indicators are introduced to compare efficient
answers.
Step 11: set t � t + 1 and return to step 2.
(i) Non-uniformity of Pareto front (NPF): this shows
To increase the efficiency of the NSGA II algorithm in the number of undefeated answers in the Pareto set
optimizing target functions, it is necessary to adjust the obtained for each problem. The higher the number
algorithm’s basic parameters using the Taguchi method. of points, the more efficient the algorithm.
Therefore, nine experiments are designed by the Taguchi
method. The NSGA II algorithm is performed based on the (ii) Maximum spread index (MSI): this measure shows
levels presented in Table 3. The average S/N ratio diagram for how many of the answers of a Pareto set are dis-
selecting the optimal level of NSGA II algorithm parameters tributed in the answer space, which is calculated
is shown in Figure 4. from equation (17). The larger the value of this
According to Figure 4, it can be found that the highest criterion, the more appropriate the diversity of
point in the mean chart of the S/N ratio is the selection of Pareto set answers.
the desired level to set the parameter of the meta-heuristic 􏽶���������������
􏽴
algorithm. Therefore, to increase the efficiency of the K
2
NSGA II algorithm, N pop parameter is 200, Max it pa- MSI � 􏽘 􏼐fmax
k − fmin
k 􏼑 , (17)
rameter is 200, and Pc and Pm parameters are 0.08 and 0.9, k�1
respectively.
Due to the use of two different methods in solving the in which fmax and fmin show the largest and lowest
j j
mathematical model, it is necessary to define indicators to values of the objective function in terms of the
compare the results obtained from the two methods. In the objective function k among the efficient answers.
Discrete Dynamics in Nature and Society 11

Table 3: Parametric adjustment of meta-heuristic algorithms by the Taguchi method.

Parameter Level 1 Level 2 Level 3
N pop 100 150 200
Max it 150 200 300
Pc 0.03 0.05 0.08
Pm 0.7 0.8 0.9

Data Means
Max it N pop
35
30
25
20
Mean of SN ratios

15

1 2 3 1 2 3
Pc Pm
35
30
25
20
15

1 2 3 1 2 3
Signal-to-noise: Smaller is better

Figure 4: Mean diagram of S/N ratio in NSGA II algorithm.

(iii) Spacing: this indicates the extent to which the an- considered for each project. Based on this, first, using fuzzy
swers are evenly spaced, calculated from equation hierarchical analysis method, the weight of project financing
(18). In this regard, the value of di can be calculated risk is determined based on the conceptual model of Fig-
from equation (19). An algorithm that is less than ure 1. Table 6 shows the comparison matrix of the fuzzy
this criterion will be more desirable. dimensions of the project risks concerning the main
􏼌
1 􏼌􏼌
􏼌􏼌 objective.
􏽐K−
i�1 􏼌d − di 􏼌
􏼌
SM � , (18) After aggregating experts’ opinions, the final pairwise
(K − 1)d comparison matrix between project risks is formed in Ta-
ble 7. Moreover, based on the steps expressed in the fuzzy
K 􏼌 􏼌
di � min ⎛ ⎝ 􏽘 􏼌􏼌􏼌􏼌fi − fj 􏼌􏼌􏼌􏼌⎞
⎠, ∀i � 1, . . . , n.
hierarchy analysis method, the magnitude of the indicators
j�1,...,n j≠i k k can be shown concerning the model’s primary purpose, as
k�1
shown in Table 8.
(19) By determining the magnitude of each of the indicators
(iv) CPU time: an algorithm with less computation time and other analyses of pairwise comparisons of each project
would be more desirable. financing risk concerning the project financing source, the
weight of each indicator for the primary purpose and origin
5. Results and Discussion of financing can be determined. Table 9 shows a summary of
the results.
After designing the mathematical model and presenting the Based on the results of Table 9, it can be stated that Iran’s
conceptual model in this section, the results of financing economic conditions are the riskiest in financing projects,
some sustainable projects in Iran that have faced budget followed by sanctions on Iran, limited resources, and po-
deficits have been analyzed. Therefore, Tables 4 and 5 show litical and international conflicts. By determining the weight
the list of international projects in Iran and the set of of financing risks regarding the financing sources of in-
practical risks in financing each project, respectively. ternational projects, the two-objective model presented by
Based on the information gathered and the assumptions the epsilon constraint method and the NSGA II algorithm is
of the problem, 12 international projects, eight types of fi- solved. The set of efficient answers obtained is shown in
nancing risks, and three types of financial risks have been Table 10. The best value of the first objective function is
12 Discrete Dynamics in Nature and Society

Table 4: List of international projects.

No. Project name Project site Amount Foreign investor Results and achievements
Arkan Khan Petro Thirty jobs were created, which is
Private and foreign
1 Refinery Production Mako Free Zone $ 500.000 expected to increase its production
sector investor (Turkish)
Project capacity to 150 tons per month.
Creating a satellite system of three
satellites in a solar orbit is a 500- to
Asia-Pacific Space
700-kilometer rotation, with the
International Student Cooperation
Iran Space Research larger satellite at the center and the
2 Small Satellite Project $ 3.2 million Organization and
Institute cube satellites equipped with their
(SSS) Bihang University,
propulsion subsystem at a maximum
China
distance of 500 kilometers around it
to communicate with the satellites.
Harmonization of space for peaceful
purposes, sharing of space
infrastructure between several
Multi-Mission Small
Beihang University of countries, encouraging the use of
3 Satellite System Iran Space Agency $ 12 million
China space for economic development,
(SMMS) Project
enhancing the space capabilities of
member countries, and establishing a
space data corridor.
The agency’s technical cooperation
projects cover 30 areas where health,
Technical cooperation International Atomic nutrition and agriculture, and safety
4 Iran $ 1 million
project Energy Agency and security are the highest priorities
for cooperation between the agency
and the member states, respectively.
To make the scientific activities
related to the Mercury transit
astronomical event more purposeful,
Mercury planet transit it was carried out by the Iranian Space
5 Kashan University $ 2 million Middle East Iota
project Agency, the Middle East Iota, and the
Kashan University Observatory with
the support of the Iranian
Astronomical Society.
Vienna Hospital Kermanshah
6 $ 120 million Chinese investors —
Construction Project (Vienna Hospital)
It will employ 1,500 people, of which
Zagros Ceramic Tile
7 Kermanshah $ 100 million China 1,400 will be from Kermanshah and
Project
100 from China.
With the completion of this project,
210 people will be directly employed,
8 Ferroalloy plant project Kermanshah $ 10 million China
and 400 people will be indirectly
employed in Kermanshah.
Foreign investment
9 Tabriz $ 10 million Turkish company Employment of 500 people.
town project
Iran Gas The results lead to a more accurate
International project of
Engineering and definition of improvement plans in
10 Gas Engineering and $ 6 million
Development line with the sustainable development
Development Company
Company of project management capabilities.
With the implementation of these
projects, the copper production chain
in Varzeqan city will be completed. It
Melting plant project
East Azerbaijan will be the beginning of starting a
11 and development plans $ 13 million Chinese company
Province (Varzeqan) significant job creation in the region
of Sungun copper mine
that will lead to economic
development and prosperity in the
town.
The implementation of this
One billion and
marvellous plan can play a significant
Tabriz-Bazargan East Azerbaijan 249 million and Bergiz Insaat Company
12 role in the economic prosperity and
freeway project Province 734 thousand in Turkey
development of the country and the
dollars
northwest.
Discrete Dynamics in Nature and Society 13

Table 5: Set of project financing risks.

No. Risk Symbol
1 Iran sanction C1
2 Available historical records C2
3 Resource constraints C3
4 Economic conditions of Iran C4
5 Political and international conflicts C5
6 Election C6
7 Lack of investment in the design phase C7
8 World economic conditions C8

Table 6: Fuzzy dimension comparison matrix.

C1 C2 C3 C4 C5 C6 C7 C8
(1, 2, 3) (2, 3, 4) (1, 2, 3) (5, 6, 7) (4, 5, 6) (1, 2, 3) (1, 2, 3)
C1 (1, 1, 1) (1, 1, 1) (1, 2, 3) (2, 3, 4) (7, 8, 9) (7, 8, 9) (3, 4, 5) (6, 7, 8)
(1, 2, 3) (2, 3, 4) (2, 3, 4) (2, 3, 4) (6, 7, 8) (2, 3, 4) (3, 4, 5)
(1/3, 1/2, 1) (2, 3, 4) (1, 1, 1) (2, 3, 4) (1, 2, 3) (2, 3, 4) (1, 2, 3)
C2 (1, 1, 1) (1, 1, 1) (1, 1, 1) (2, 3, 4) (1, 1, 1) (1, 1, 1) (1, 2, 3) (1, 1, 1)
(1/3, 1/2, 1) (1, 2, 3) (1, 1, 1) (1, 2, 3) (1, 2, 3) (2, 3, 4) (2, 3, 4)
(1/4, 1/3, 1/2) (1/4, 1/3, 1/2) (1, 1, 1) (1, 2, 3) (1, 2, 3) (4, 5, 6) (2, 3, 4)
C3 (1/3, 1/2, 1) (1, 1, 1) (1, 1, 1) (3, 4, 5) (6, 7, 8) (1, 1, 1) (7, 8, 9) (2, 3, 4)
(1/4, 1/3, 1/2) (1/3, 1/2, 1) (1, 2, 3) (3, 4, 5) (1, 2, 3) (6, 7, 8) (3, 4, 5)
(1/3, 1/2, 1) (1, 1, 1) (1, 1, 1) (5, 6, 7) (4, 5, 6) (5, 6, 7) (7, 8, 9)
C4 (1/4, 1/3, 1/2) (1/4, 1/3, 1/2) (1/5, 1/4, 1/3) (1, 1, 1) (7, 8, 9) (7, 8, 9) (4, 5, 6) (4, 5, 6)
(1/4, 1/3, 1/2) (1, 1, 1) (1/3, 1/2, 1) (2, 3, 4) (6, 7, 8) (7, 8, 9) (7, 8, 9)
(1/7, 1/6, 1/5) (1/4, 1/3, 1/2) (1/3, 1/2, 1) (1/7, 1/6, 1/5) (5, 6, 7) (4, 5, 6) (7, 8, 9)
C5 (1/9, 1/8, 1/7) (1, 1, 1) (1/8, 1/7, 1/6) (1/9, 1/8, 1/7) (1, 1, 1) (5, 6, 7) (7, 8, 9) (8, 9, 10)
(1/4, 1/3, 1/2) (1/3, 1/2, 1) (1/5, 1/4, 1/3) (1/4, 1/3, 1/2) (4, 5, 6) (3, 4, 5) (5, 6, 7)
(1/6, 1/5, 1/4) (1/3, 1/2, 1) (1/3, 1/2, 1) (1/6, 1/5, 1/4) (1/7, 1/6, 1/5) (2, 3, 4) (1, 2, 3)
C6 (1/9, 1/8, 1/7) (1, 1, 1) (1, 1, 1) (1/9, 1/8, 1/7) (1/7, 1/6, 1/5) (1, 1, 1) (1, 1, 1) (1, 1, 1)
(1/6, 1/7, 1/8) (1/3, 1/2, 1) (1/3, 1/2, 1) (1/6, 1/7, 1/8) (1/6, 1/5, 1/4) (1, 2, 3) (1, 2, 3)
(1/3, 1/2, 1) (1/4, 1/3, 1/2) (1/6, 1/5, 1/4) (1/7, 1/6, 1/5) (1/6, 1/5, 1/4) (1/4, 1/3, 1/2) (1, 2, 3)
C7 (1/5, 1/4, 1/3) (1/3, 1/2, 1) (1/9, 1/8, 1/7) (1/6, 1/5, 1/4) (1/9, 1/8, 1/7) (1, 1, 1) (1, 1, 1) (1, 2, 3)
(1/4, 1/3, 1/2) (1/4, 1/3, 1/2) (1/6, 1/7, 1/8) (1/9, 1/8, 1/7) (1/5, 1/4, 1/3) (1/3, 1/2, 1) (3, 4, 5)
(1/3, 1/2, 1) (1/3, 1/2, 1) (1/4, 1/3, 1/2) (1/9, 1/8, 1/7) (1/9, 1/8, 1/7) (1/3, 1/2, 1) (1/3, 1/2, 1)
C8 (1/6, 1/7, 1/8) (1, 1, 1) (1/4, 1/3, 1/2) (1/6, 1/5, 1/4) (1/10, 1/9, 1/8) (1, 1, 1) (1/3, 1/2, 1) (1, 1, 1)
(1/5, 1/4, 1/3) (1/4, 1/3, 1/2) (1/5, 1/4, 1/3) (1/9, 1/8, 1/7) (1/7, 1/6, 1/5) (1/3, 1/2, 1) (1/5, 1/4, 1/3)

75190.120 thousand dollars, and the best deal of the second solution methods, including different efficiency solutions,
objective function is 2665292.075 rusks per thousand are analyzed.
dollars. Table 11 illustrates that the epsilon constraint method
According to the results of Table 10, it can be seen that has estimated the lowest financing cost of projects by cre-
with the reduction of financing restructuring of interna- ating various efficient solutions. In comparison, the NSGA II
tional projects, the cost of financing sources will increase. algorithm has reduced the risk of financing sustainable
Hence, the Pareto front is obtained from solving the two- projects by creating more efficient solutions than the epsilon
objective financing model in the form of equation (5). constraint method. Also, the NSGA II algorithm obtains the
As shown in Figure 5, to reduce the risk of sustainable most expansion indices more efficiently than the epsilon
financing of international projects, the way of financing constraint method. It has solved the designed two-objective
projects should be changed, which can lead to an increase in model in a shorter time. Therefore, due to the high efficiency
the total cost of financing projects. On the other hand, it can of each technique in specific indicators, it is necessary to
be seen that the NSGA II algorithm has obtained 32 efficient prioritize the solution methods using the TOPSIS method.
answers (a combination of how projects are financed). Each Based on this, Table 12 has been designed by considering six
of the answers has advantages over the other answers ob- indicators (averages of the first and second objective
tained. The epsilon constraint method also brought 11 ef- functions, number of efficient answers, maximum expan-
ficient answers. In Table 11, other comparison indicators of sion, metric distance, and computational time) and two
 14

Table 7: Fuzzy dimension comparison matrix based on the sum of experts’ opinions.
C1 C2 C3 C4 C5 C6 C7 C8
C1 (1, 1, 1) (1, 1.59, 2.08) (1.59, 2.62, 3.63) (1.59, 2.62, 3.63) (4.12, 5.24, 6.32) (5.52, 6.54, 7.56) (1.82, 2.88, 3.91) (2.62, 3.83, 4.93)
C2 (0.48, 0.63, 1) (1, 1, 1) (1.26, 1.82, 2.28) (1.26, 1.44, 1.59) (1.26, 1.82, 2.29) (1.00, 1.59, 2.08) (1.59, 2.62, 3.63) (1.26, 1.82, 2.29)
C3 (0.28, 0.38, 0.63) (0.44, 0.55, 0.79) (1, 1, 1) (1.44, 2.00, 2.47) (2.62, 3.83, 4.93) (1.00, 1.59, 2.08) (5.52, 6.54, 7.56) (2.29, 3.30, 4.31)
C4 (0.28, 0.38, 0.63) (0.63, 0.69, 0.79) (0.41, 0.50, 0.69) (1, 1, 1) (4.12, 5.24, 6.32) (5.52, 6.54, 7.56) (5.19, 6.21, 7.23) (5.81, 6.84, 7.86)
C5 (0.16, 0.19, 0.24) (0.44, 0.55, 0.79) (0.20, 0.26, 0.38) (0.16, 0.19, 0.24) (1, 1, 1) (4.64, 5.65, 6.65) (4.38, 5.43, 4.46) (6.54, 7.56, 8.57)
C6 (0.13, 0.15, 0.18) (0.48, 0.63, 1.00) (0.48, 0.63, 1.00) (0.13, 0.15, 0.18) (0.15, 0.18, 0.22) (1, 1, 1) (1.26, 1.82, 2.29) (1.00, 1.59, 2.08)
C7 (0.26, 0.35, 0.55) (0.28, 0.38, 0.63) (0.13, 0.15, 0.18) (0.14, 0.16, 0.19) (0.15, 0.18, 0.23) (0.44, 0.55, 0.79) (1, 1, 1) (1.44, 2.52, 3.56)
C8 (0.20, 0.26, 0.38) (0.44, 0.55, 0.79) (0.23, 0.30, 0.44) (0.13, 0.15, 0.17) (0.12, 0.13, 0.15) (0.48, 0.63, 1.00) (0.28, 0.40, 0.69) (1, 1, 1)
Discrete Dynamics in Nature and Society
Discrete Dynamics in Nature and Society 15

Table 8: The degree of magnitude of the indicators in relation to the main goal.
V1 V2 V3 V4 V5 V6 V7 V8
V1 — 0.128 0.592 1 0.614 0 0 0
V2 1 — 1 1 1 0.183 0 0
V3 1 0.457 — 1 1 0 0 0
V4 0.951 0 0.478 — 0.479 0 0 0
V5 1 0.289 0.879 1 — 0 0 0
V6 1 1 1 1 1 — 0 0.327
V7 1 1 1 1 1 1 — 1
V8 0.951 0 1 1 0.479 1 0 —

Table 9: Final weight of financing risks.

Towards the primary purpose A1 A2 A3
W1 0.327 0.571 0.000 0.429
W2 0 0.538 0.000 0.462
W3 0.164 0.563 0.438 0.000
W4 0.343 0.000 0.600 0.400
W5 0.164 0.000 0.417 0.583
W6 0 0.312 0.000 0.688
W7 0 0.429 0.000 0.571
W8 0 0.111 0.889 0.000

Table 10: A set of answers obtained from solving the financing model.
Epsilon restriction (EP) NSGA II algorithm
No. Z1 Z2 No. Z1 Z2 No. Z1 Z2
1 75190.120 3104970.730 1 77488.56 3053879 17 88389.01 2809067
2 76574.280 3061002.860. 2 77924.38 3027474 18 90687.55 2742120
3 78445.340 3017035.000 3 78501.25 3022165 19 91259.74 2734122
4 80316.400 2973067.130 4 78664.65 3018854 20 91358.57 2726665
5 82178.450 2929099.270 5 78747.21 3004553 21 91328.60 2726657
6 84058.510 2885131.400 6 79025.61 3000289 22 91358.92 2726649
7 85929.570 2841163.540 7 81339.62 2968256 23 91415.01 2725034
8 87800.630 2797195.140 8 82179.14 2951147 24 91882.48 2713281
9 89671.680 2753227.810 9 82377.4 2946201 25 91882.48 2713280
10 91542.740 2709259.540 10 84627.01 2903703 26 92136.37 2706698
11 93903.360 2665292.270 11 85568.61 2879211 27 92387.54 2700476
12 — — 12 85590.53 2887847 28 92387.67 2700463
13 — — 13 87363.82 2836211 29 92380.23 2700422
14 — — 14 87240.21 2836099 30 92387.89 2700231
15 — — 15 87361.81 2836075 31 92401.60 2700000
16 — — 16 87377.66 2828770 33 92402.44 2699965

options (epsilon constraint method and NSGA II According to the results of Table 13, the domestic capital
algorithm). market can provide 54.89% of the deficit budget of the
Table 12 demonstrates that the NSGA II algorithm is the country’s international projects. Also, 44.81% of the project
superior solution method due to the high value of weight deficit budget can be financed from a foreign bank loan source,
utility (0.5636) compared to the epsilon constraint method and only 0.2% of the budget can be funded through the
(0.4364). Therefore, according to the results obtained from company’s internal resources. Therefore, the risk of financing
solving the two-objective model and selecting the NSGA II from the domestic capital market and the cost of funding it are
algorithm due to its high weight, the amount of funding very appropriate. Figure 6 shows how projects are financed
from different sources for each project is shown in Table 13. from different financial sources.
16 Discrete Dynamics in Nature and Society

×106
3.15

3.1

3.05

2.95

2.9
Z2

2.85

2.8

2.75

2.7

2.65
7.4 7.6 7.8 8 8.2 8.4 8.6 8.8 9 9.2 9.4
Z1 ×104

Epsilion Constraint
NSGA II
Figure 5: Pareto front obtained from solving the mathematical model of sustainable financing.

Table 11: Comparison indicators of problem solving methods.

Indicator EP NSGA II
Mean of Z1 84147.28 87111.600
Mean of Z2 2885131.40 2828651.86
NPF 11 32
MSI 354227.73 440076.70
SM 0.002 1.071
CPU time 20.34 15.76

Table 12: Weighting coefficients of comparison indicators of solution methods.

Indicator EP NSGA II Weighting coefficients
Mean of Z1 84147.28 87111.600 0.02
Mean of Z2 2885131.40 2828651.86 0.02
NPF 11 32 0.02
MSI 354227.73 440076.70 0.02
SM 0.002 1.071 0.1
CPU time 20.34 15.76 0.1
WE 0.4364 0.5636 -
Discrete Dynamics in Nature and Society 17

Table 13: Amount of financing performed using NSGA II algorithm.

Deficit Company internal Domestic capital Bank loans
Project name
(thousand dollars) resources (J1) markets (J2) (J3)
Arkan Khan Petro Refinery Production Project 315 32.560 148.832 133.608
International Student Small Satellite Project (SSS) 1489.98 — 1460.00 27.980
Multi-Mission Small Satellite System (SMMS)
2975 — 2975.00 —
Project
Technical cooperation project 240 — 240.00 —
Mercury planet transit project 480 — 480.00 —
Vienna Hospital Construction Project 39250 — 39250.00 —
Zagros Ceramic Tile Project 28750 — 23944.74 4805.252
Ferroalloy plant project 345 — 3455.000 —
Foreign investment town project 535 — 4327.573 1207.427
International project of Gas Engineering and
2580 — 2104.293 475.707
Development Company
Melting plant project and development plans of
10435 3086.377 3633.947 3714.676
Sungun copper mine
Tabriz-Bazargan freeway project 1002734 — 520908.79 481825.221

1000000
100000
10000
1000 $

1000
100
10
1
Arkan Khan Petro...

nternational Student...

Multi-Mission Small...

Technical cooperation...

Mercury planet transit...

Vienna Hospital...

Zagros Ceramic Tile...

Ferroalloy plant project

Foreign investment town...

International project of...

Melting plant project and...

Tabriz - Bazargan...

Project List

Internal resources of the company

Domestic capital market
Bank loans
Figure 6: Amount of financing for international projects from different sources.

6. Conclusion Analyzing the results of the superior method for financing

12 international projects in Iran that are facing budget deficits
Based on the opinions of experts in prioritizing the risks of illustrates that the domestic capital market can provide 54.89%
project financial security, it was found that Iran’s economic of the deficit budget of the country’s international projects.
conditions are the riskiest in financing projects because Also, 44.81% of the project deficit budget can be financed from
sanctions on Iran, limited resources, and political and in- a foreign bank loan source, and only 0.2% of the budget can be
ternational conflicts are the following influential factors. financed through the company’s internal resources. Therefore,
Based on this results, 11 different efficient answers were the risk of financing from the domestic capital market and the
obtained from the epsilon constraint method, and 32 other cost of funding it are very appropriate. Future research suggests
efficient answers were obtained from the NSGA II algorithm. that other meta-innovative methods achieve more desirable
Examining indicators (such as mean objective functions, results than the NSGA II algorithm and discuss the uncertainty
number of efficient answers, maximum expansion, metric in the financing of international projects.
distance, and computational time) shows that the NSGA II It is also suggested that the financing method of public-
algorithm has the highest efficiency in achieving a suitable private partnership should be considered in mathematical
answer minimizing financing costs and financing risks. modeling to determine the contribution of each in the
18 Discrete Dynamics in Nature and Society

financing of sustainable projects. On the other hand, other africa,” in The China Question, pp. 161–180, Palgrave Mac-
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