The Path To Circulate Necessary Funds For Economic Development In Jilin Province

As we all know, funds take measures to promote the development of economy, so raising funds to both macro main bodies and micro main bodies is very of importance. During the process of Revitalizating the Northeast Old Industrial Base, the economic development in Jilin province is restrained by shortage of fund, therefore, whether and how to circulate necessary funds is most important. In broad sense, to circulate necessary funds includes not only to borrow money but also to lend money. And the meaning in this thesis only refers to the former, that is, to borrow money, There are many kinds of channels to circulate necessary funds, which in short term includes short-time loan, commercial credit etc, and according to the range from which main bodies borrow, which in long term includes two parts: internal circulating necessary funds and external circulating necessary funds. The former mainly includes depreciation funds and remaining profit. The latter includes two parts by the quality of raising money: direct circulating necessary funds and indirect circulating necessary funds. Direct circulating necessary funds includes stocks and bonds, and indirect circulating necessary funds chiefly refers to long-time loan. Different channels will lead to different structure, whice embodies the condition of operating and finance to some extent. The MM theory, the nonsymmetry theory, the encouragement theory and the control theory elaborated gains and losses about choice of different structure and channel. Learn from these theories, we can draw a conclusion that because of the factor such as nonsymmetry information and nonzero bussiness cost, channels to circulating necessary funds will affect company value and capital cost, hence, in different conditon, the channel to circulating necessary funds should be different. However, channel to circulating necessary funds chosen by the most companies has certain general character, that is, they often mainly choose some channel or other such as loan from bank and issuing securities, which in fact is mode to circulating necessary funds. Through comparing mode and its reasons of some developed countries such as USA, Germany and Japan, a channel to fix the economy development of our country and our province will be found. In the different mode of the developed countries, USA mainly depends on securities whose companies usually raise long-time funds by issuing company bonds and stocks, so securities become their main external channel to circulating necessary funds, which is about more than 55 percent in gross external raising funds. Germany and Japan mainly depend on loan from bank which is about more than 80 percent in gross external raising funds. Drawing lessons rrom foreign developed countries and thinking of our practical condition, we think that mode to circulate necessary funds of our companies shoule be two types in different time. One is recent-transition mode, another is future-goal mode. At present, what we shoule do is to bring forth new ideas to institution, establish market-economy micro bodies, make state banks commercialized and state enterprises corporatized, recruit non-bank financial institutions and privately managed financial institutions, further standardize and develop securities market, improve the proportion of securities, on the basis of that and with the development of mark-economy system, our mode to circulat necessary funds will transit to future-goal mode, which...