Research On Debt Of Local Government

The Budget Law of the People′s Republic of China stipulates that local government is not authorized to issue local government bonds, but local governments at and blow provincial level have various finance actions which lead to the existing local debt in certain amount. Currently the local debt are very complicate and the amount is also huge in our county , so the finance risk of local government has emerged to some extent. The finance risk has become a real negative factor of the development of local economy and other undertakings. If it is not proactively prevented and solved, it will seriously damage the stability of local finance and the consistent development of public finance.The paper applies both positive and normative analysis to examine the local debt on the basis of combing theory with practice. Starting from the basic concept of local debt, this paper then studies its historical evolution and comprehensively considers its causes. The research tries to objectively reflect the reality of local debt and its influence to local economy. Based on all of this research, in order to prevent and solve local finance risk this paper provides different policy selections in solving old local debts, prevent unreasonable new debt and build new regulations on public debt.