Xi'an State-owned Investment Company Financing Method And Its Optimization

Public infrastructure is the basis of economical activity of the urban, and the important signal of developing level and the power of synthetically completion of the urban as well. The standard of Xi'an Municipal infrastructure falls behind the demand of society and economy. Many problems restraining development of the city can be completely solved by improving the infrastructure. Fund in construction of Xi'an Municipal infrastructure stems form public finance and favored loan. Owe to the serious shortage of fund in construction, more diverse channels of financing shall be exploited.In Xi'an, financing means of infrastructure which can be utilized is classified into financing of items and corporate financing. By contrast to financing of items, corporate financing play an important role. Four State-owned Investment Company of Xi'an Municipal haven' t brought their function of financing into play by utilizing the marketing means. This paper analysis specific behavior of investment and financing about State-owned Investment Company. There are two reasons which achievement of financing is not ideal. One is that four State-owned Investment Company of Xi'an Municipal belong to three different departments, its function of investment and financing has been restrainted. The other is that the relationship of "principle-agent" between government and state-owned investment company need to be improved.By introducing theory of capital structure,this paper analysis the selection of financing means considering capital costs, company administer, role of business, risk etc.Security, stock, fiduciary issue are preferential selections of State-owned Investment Company of Xi'an Municipal. In order to raise money extensively and set up new financing framework in construction of infrastructure, the ways and means of financial funds should be changed. The efficient path is to merger assets, personnel, skill and management of four State-owned Investment Company of Xi'an Municipal and to accelerate centralization of capital. Meantime, the relationship of "principle-agent" between government and stateowned investment company shall be changed from administrative relationship intocooperative relationship.In order to improving the financing function and raise fund through capital market, this paper introduces the example of JiuShi corp. ShangHai. It applies the theory of investment and financing into the practice of State-owned Investment Company of Xi' an Municipal. By making a thorough inquiry about the financing of Public infrastructure,the author propose relevant Panoramas and suggestions. This paper sets off analyses about stock financing relying on shell resource, capital operating, utilizing of new means of financial innovation and guarding against risks of financing.