Research On The Capitalization Operation Of Industry Development Special Fund In Shenyang City

Shenyang city government invested 1 billion RMB each year successively in the past three years to enlarge the utility of industry development special fund as basic strategy for the prosperity of this city, but the result can not satisfy the goal of the administrators because of reasons such as low efficiency, bad co-operation and waste of country resourses. As a result, the main purpose of capitalization operation is to bring market rules into government investment to meet those shortcomings before.The capitalization operation means that it introduces the market mechanism in the government investment. The framework of capitalization operation is drawn up and two investment models are brought up based on two different financial tools: creditor and equity. The guarantee mechanism is brought into the system, which plays an important part in the capitalization operation. Through the data analysis of the experts'questionnaires, we can testify the feasibility of the operation. The application scope is expounded in this article. Then the operation of each model is explained. The outline about the withdrawal mechanism is drawn up, which elaborates the importance of the mechanism.In the withdrawal mechanism of the debt investment, it may adopt the cash and the non-cash way to finish the fund recycling, when projects belong to normal withdrawal. Or else it may use the models of the extension loan deadline, transferring shares of stock, transferring the allocation and canceling the bad account. The author builds an index system to evalue the financial condition of the unit invested and takes an actual example to test its effort. The private equity may adopt the stockholder's rights buy-back, the transferring of the property trading market, transferring the government allocation and the canceling private equity to withdraw the fund.