Study On Investment And Financing Platform Risks And Countermeasures Of Local Government In China

The local government investment and financing platform has played a positive role withmeans of financing for the public investment, in improving infrastructure and stimulateeconomic growth, etc. While, because the financing scale of local government investment andfinancing platform is oversized, the financing structure and fund input is not reasonable, thecircumstance of surpassing local government's reimbursement ability not only has increasedthe government debt redemption pressure , and if not handled properly, will lead to greaterrisk. In view of this, how to sort out the relationship between the government and thecorporate in the investment and financing platform, and actively guide investment andfinancing behavior of local government, prevent and control the risks in investment andfinancing of local government has become an important research subject.This article researches from analyzing the basic theory of local government risk ininvestment and financing, and taking operating risks of the local government investment andfinancing platform in the form of investment and financing company in recent years as theanalysis emphasis. At first, the article summarized the main performance of risks ofinvestment and financing platform, and analyzed the reasons of the risks. Secondly, bydrawing on the successful experiences and failures in managing debt risk of investment andfinancing of foreign local government, the article presented on several inspirations in theprevention and control of risk in investment and financing of local government in China.Finally, according to the manifestation and causes of the risks of local government investmentand financing platform in China, on the basis of international experience for reference, thisarticle made some specific suggestions to prevent and control risks of local governments inChina in investing and financing, respectively, from establishing local government investmentand financial risk early-warning system, improving risk prevention mechanism of localgovernment investment and financing platform, reducing the dependence of debt financing oflocal government and other aspects .