Local Financial Risk Research

Public finance is the basic condition of social re-production, which reflects comprehensively the national political and economic situation. In the late years, active fiscal policy has been put into practice and good performance has emerged. At the same time, fiscal deficit and fiscal debts have become larger and larger, which has brought out indefinite factors for the stable operation of public finance. It is the focus of attention that how we ought to prevent fiscal risks and guarantee the sustainable development of public finance. 揥e ought to carefully safeguard and prevent fiscal risks? which was put forward by Premier Thu Rongji in the state council report in 2000. At present, there are many problems in the operation of public finance, especially in the operation of public finance at countly- township level. The absence of necessary financial revenue makes it impossible to carry out local government抯 function successfully. In order to step up the national economic development and sustain the regular function of local governments, it is important for us to comprehend correctly and prevent effectively local fiscal risks. In view of the above reasons, the author has had the idea of study on local fiscal risks. Applying the theory to reality is the basic thought of the thesis. First of all, the author makes a brief theoretical introduction to local fiscal risks. Secondly, according to the concrete display of locaP fiscal risks, the author draws a conclusion that local fiscal risks have emerged. At the same time, the author analyses the cause of local fiscal risks. Finally, the preventing measures of local fiscal risks are put forward at the end of this thesis. Therefore, the logic structure of this thesis is divided into three parts, according to the above thought. The first part is the brief introduction to local fiscal risks. The second part is the concrete display and cause of local fiscal risks. The third part is the preventing measures of local fiscal risks. The three parts are as follows. Chapter 1, the brief introduction to local fiscal risks Before summarizing local fiscal risks, we ought to comprehend the definition of local fiscal risks and their arrangement of ideas, which is the premise of comprehending the contents and characteristics of local fiscal risks. So this chapter is divided into two sections as follows. Section 1, the concept of fiscal risks and their arrangement of ideas. In this section, the author explains the definition of fiscal risks posed by domestic and overseas scholars, and makes remarks on it At the same time, the author poses his own opinion on the definition of fiscal risks, that is, fiscal risk is the possil)ility of the unstable operation of public finance, because of the contradiction between financial revenue and financial expenditure caused by policy, system, management, and so on. In the long run, fiscal risks are equal to governmental debt risks. Secondly, the author poses the four kinds of fiscal risks according to governmental debts. Generally speaking~ the governmental debts include direct explicit liabilities, direct implicit liabilities, contingent explicit liabilities and contingent implicit liabilities. Therefore, the four kinds of fiscal risks are as follows. The first kind of fiscal risks is caused by direct explicit liabilities, the second kind of fiscal risks is caused by direct implicit liabilities, the third kind of fiscal risks is caused by contingent explicit liabilities, the fourth kind of fi...