Path Analysis On Governance Structure Reform Of Chinese Rural Credit Cooperation

The biggest problem in China is peasantry problem, and peasants' key problem is the developing direction of rural economics. Lack of fund is the biggest problem. Thus, rural finance has practically become the key point of entire rural development in China. Rural finance system has to be reformed for the development of agriculture and rural economics. In the "State Department's Decisions on Rural Finance System Reform" issued in Aug., 1996, it is clearly stated that the target of our rural finance system reform is to set up and improve the rural finance service system with cooperative finance as foundation and the division and cooperation between commercial finance and policy finance, in which the key point is to reform rural credit cooperation management structure and set up and improve Chinese rural cooperative finance system; and the core is to change rural credit cooperation to real cooperative finance organization." This decision shows the right direction for the reform of rural credit cooperation. In the National Conference for Rural Credit Cooperation, detailed reform scheme was submitted for cooperative finance management system.However, as the reform of rural credit cooperation goes deep, various potential problems come up. Currently the difficulties and problems in the rural cooperative finance reform and development are: first, the rural credit cooperation ownership remains unclear; second, there is too much "cord" in the organization management system, and the administration intervene inertia remains strong; third, it needs to be reinforced to carry out cooperation system principle and criterion; fourth, it is quite serious that the rural credit cooperation in many counties and cities lose money or bankrupt; fifth, government support is not enough, and continuous development environment still needs to be improved.However, as the micro-foundation of continuous development for rural credit cooperation, the corporate governance structure has seriously restrain the healthy development of our rural credit cooperation. If the corporate governance structure wouldn't be improved as soon as possible, to make it suitable for the rural economics changes, it could not give any finance support to rural economics development, and the existence and development of rural credit cooperation itself would become a long-term question. Therefore, this article will discuss the rural credit cooperation development from the view of micro corporation entity with the idea of "finding out and clearing the origin". This article will analyze problems in property right, governance structure and exteriors management environment and propose suggestion on re-structure of Chinese rural credit cooperation taking practical experience of rural credit organization in developed countries for reference.