Discussion On Creating Of Legal System Of Chinese Local Government Bonds

Local government bonds, refers to the local governments in the region socio-economicdevelopment conditions and funding shortages extent, in accordance with relevant laws andregulations to the public public offering of the bonds. With the accelerated urbanizationprocess in China, local governments in urgent need huge funds for construction, plus therights and financial power of local government tax system reform in China caused by theirrational does not match, so at this stage of the vast majority of local government finances areseverely strained, had rely on borrowing to maintain. The international financial crisis in2009has a serious impact on our economy, which further exacerbated the financial difficulties oflocal governments in China. To this end, the State Department had to avoid the prohibitionprovisions of the "Budget Law", and decided to release the local government bond issuance in2009. March19,2009the State Council decided dubbed the name of the local government,local government bonds issued by the Ministry of Finance on behalf of200billion yuan.October20,2011, the Ministry of Finance announced a pilot approach for the2011localgovernment to issue bonds on their own, the provisions of the2011Shanghai, Zhejiang,Guangdong Province, Shenzhen City will carry out local government to issue bonds on theirown pilot.But at this stage of the local government bond issuance there are major issues: Chinadoes not establish the legal system of local government bonds. In this paper, based on theanalysis of the special circumstances of our country and learn from the mature foreignexperience, try to put the legal system, how to build our local government bonds. The firstpart defines the concept of local government bonds, and to analyze the pros and cons ofissuing local government bonds, I believe that, if not to legislate strict control of localgovernment bonds, then the local government bond issues will lead to huge risks. Firstintroduced in the second part of the risk of the issuing local government bonds, and thendescribes the need for the legislation system of local government bonds issued. The thirdsection describes the legislative principles of local government bonds. The fourth part is thebasis of the first part, the specific vision of building a system of local government bonds,mainly from the principal of bonds, bonds, and approval procedures, supervision and management responsibility to provide for.