Economic evaluation on cross-border bridge project using Monte Carlo simulation: A China–Russia project case study

Hongyi Lv, Zhenwu Shi and Jie Liu

The Engineering Economist, 2025, vol. 70, issue 3, 73-100

Abstract: Cross-border bridge projects play a crucial role in enhancing economic integration and regional connectivity. However, traditional economic evaluation methods often fail to capture the uncertainties associated with such large-scale infrastructure investments. This study employs Monte Carlo Simulation (MCS) to assess the economic feasibility and risks of the China–Russia Heihe Bridge project. By incorporating probabilistic analysis into financial assessment, we estimate key indicators, including Net Present Value (NPV), Internal Rate of Return (IRR), and Dynamic Payback Period (DPP) under varying economic conditions. The results indicate a positive economic outlook, with an expected NPV of 19.44 billion Russian rubles and an IRR of 12.05%, surpassing the benchmark rate of 8%. Sensitivity analysis confirms the project’s financial resilience, maintaining feasibility even under adverse scenarios of increased costs and reduced benefits. The findings highlight the effectiveness of Monte Carlo Simulation in improving the accuracy of infrastructure investment evaluations. This study provides valuable insights for policymakers and investors in assessing cross-border infrastructure projects under uncertainty.

Date: 2025
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DOI: 10.1080/0013791X.2025.2515824

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