Analysis On Problem And Countermeasure Of Financing For Military Enterprise In China

Military enterprises who undertake the sacred mission of protecting national security and sovereign independence serve for defense by military products, so it is really very important to research the development of military enterprises in china. Among them, problems in financing process are the important bottleneck factors to restrict the development of military enterprises. This paper starts with an analysis on macro financing environment of military enterprises and points out that the development of China's market economic system and policy environment have been prepared for military enterprises to reform their financing modes. Then, corresponding countermeasures are proposed for military enterprises after analyzing problems in current financing status.After three decades of development of national market economy, there is good domestic environment provided for development of our national military enterprises as the gradual improvement of the market system, the gradual consummating of the financing mode, the maturation of policies and regulations, the development of capital markets and the accumulation of successful experience in long-term innovation of state-owned enterprises. Because of the traits that capital needs is huge, capital sources is political, capital run is full of high risk and social capital is obstructed from entering in, which lead to the result that the funds supply is insufficient and financing channel is narrow in the development of our national military enterprises. In the financing process of military enterprises, the lower capability of profitability and state-owned developing mode determine that the inner accumulation of capital is limited and it is difficult to use financing tools provided by capital markets for them to get capital. As a result, these factors cause the current financing situation that capital is mainly obtained from state funds, secondly from loans of policy banks and less from inner and external financing.After the analysis on current financing situation of our national military enterprises, the bottleneck factors limiting the financing are mainly existed in four areas:single object in investment, lack of financing channels,less financing tools and deficient support. The deep level reasons causing these problems are:behindhand ideological, so many barriers for investment, imperfect system reform and rare of policies and regulations. It is just because of the existence of these factors, which hinder the smooth of financing channel and limit the access to get capital for our national military enterprises.According to the specific problems in the process of financing in our national military enterprises, this paper proposes five suggestions: First, enhancing the flexibility of our national military enterprises' financing system; Second, advancing the development of capital market to increase financing tools for military enterprises; Third, cultivating and improving the military capital operating intermediaries; Fourth, strengthening the leading and protecting function of corresponding financing rules and regulations for military enterprises'financing; Fifth, establishing defense industrial investment fund. So far, after the improvement in the areas of financing for military enterprises in China, on the one hand, it will increase the inner capital accumulation by enhancing the capability of profitability, on the other hand, through the frequent appearance of innovative financing tools in capital market, the constant emergence of security laws and regulations, the gradual involvement of intermediaries and the establishment of defense industrial investment fund, which provide multiple channels and tools support to the military enterprises for financing. Thus, it is realistic and feasible for our national military enterprises to achieve the goal of diversification in investment object and financing channel.