Study Of Local Government Bond Issuance System

Local government bond, which is issued by the local government, plays an important role in local government financial system. According to the local area's economic development and finance condition, the local government issue local government bond to finance city infrastructure construction. From the experience of foreign country, local government bond had been an important financing tool for local government. But our country budget law prohibits local government from issuing bond. So local government bond in our country has not got law support. Based on the financial deficits expanding as tax-sharing system carrying out, many local governments had a large covert debt and lacking effective ways to raising funds, many researchers and people has focused on the question that whether our local government should have the right to issue bonds. In the affect of economic crisis in 2008, our government had decided to issue 2000 million Yuan specified local government bond, which is published by the central government but named for the local government, to help local government overcome the economic difficulty. These funds should been used for improving people's livelihood and local area infrastructure condition. As this finance method implementation, some questions about local government bond scale and limits of authority put on the agenda of government bond reform. Based on the experiences of American and Japanese and France bond markets and some positive element of our specified local government bonds issuing in 2009, anglicizing the questions in the process of issuing this specified local government bonds, this article has proposed the method of issuing and flowing bond which is suitable our national condition in the last.