Government Debt Risk Management

In recent years, as the country’s economy has boomed, with the rapiddevelopment of industrialization and urbanization, local construction capital demandincreasingly urgent, local governments afford heavy expenditure burden, but localgovernments’ financial capacity is deficient, In order to deal with this kind ofsituation, the government through various measures to raise funds for publicinvestment,this make the government debt grow rapidly, it caused enormousgovernment debt repayment pressure and financial risk. The existing government debtaccounting system make debt risk been undervalued, and caused the governmentadministration departments severely underestimated the scale of the debt and beenoverly optimistic for financial situation, which is disadvantageous for the debtmanagement and maintain the financial sustainability, some cases can lead to severedebt crisis. Therefore, the significance of strengthen debt management and makegovernment accounting reform become particularly important. Therefore, this articlemake primary research for the reform of government debt accounting system,absorbs the foreign experience, from the perspective of strengthen the governmentdebt risk control, make improvement suggestion for the current government debtaccounting and reporting systems, through empirical analysis, establishing anEarly-Warning system of risks, and finally to the government debt managementmethod put forward some countermeasures.This paper aims to realize three basic purpose, first of all, find the defect of thegovernment debt accounting system and make appropriate improvement; in thesecond place, establish debt risk early-warning model through empirical analysis; inthe last place, make some policy suggestions to Improve government debtmanagement.This paper research ideas and core content mainly includes: first of all, reviewthe theory and research results of the government debt management and governmentaccounting system. Secondly, analyze the defect of government debt accountingsystem in our country and give some improve suggestions. Thirdly, select a concretedebt data through the data analysis, and using empirical analysis method to measure the debt risk early warning model; At last, make a concrete analysis to thegovernment debt risk management problems, and search for some effective solutions.Through the analysis draw the following conclusions: the government debtsituations of China are not optimistic, although debt risk early warningmechanismexist for a long time, but not been strictly carried out, and there are notrelevant laws to guarantee control of the government debt risk.The governmentdebt accounting system is not perfect which is an important reason for theunderestimation of the government debt risk, which is adverse to the effectivecontrol of the government debt, increase the financial risk. Therefore, in order tojudge the government debt scale, estimate the debt risk status precisely, reformthe government accounting system, build effective government debt risk earlywarning system and enforce it strictly, at the same time, make effective debt scalecontrol through legal, economic and administrative means.