Studies On The Movements Of Rural Funds In Nanjing

With the new construction of the rural areas and development of the rural economics, the requirement of the funds in a rural area is increasing every year, however, the supply of rural funds is not only meet the farmers and rural enterprises needs for capital difficultly, but also causes a great deal of rural funds outflows of due to a lack of proper rural financial systems. Especially as the main banking institution of rural funds providers, such as the Agricultural Bank of China and Rural Credit Cooperatives and other financial institutions have been declined of their contributions ever year along with the construction and development of the Rural Areas. It makes a serious phenomenon of outflow of funds form rural financial systems and makes reform of propulsion and fund supply reality contradict each other which hinder the construction of a new Socialist countryside demand for funds.This article is based on the capital flows in recent5-10years in the rural areas in Nanjing with the onus of proof, through data, quantitative analysis and other methods which preliminary study the rural funds in Nanjing. It verifies the capital flows in rural areas of Nanjing form primary channel including financial, fiscal and taxation and price. At the same time to analyze the capital flow in rural areas with different channels and to take some sample data of Luhe District as example in order to analyze the primary cause for hinder the capital flow in rural areas is high risk of agriculture and the dual structure in urban and rural economy which lead to capital flows preference. The main reason is available from the following three sectors:Firstly, the rural capital outflows by reason of rural financial environment, it including mainly finance credit in rural areas and the lack of backward rural investment, which in turn affected the rural areas of loan and absorb funds. Secondly, the rural capital outflows mainly affected by rural financial institutions pursuit of profit maximization, adjustment and operational strategies for avoiding credit risk blindly implications; Lastly, from the point of view of rural finance policy, lack of financial support to agriculture, supporting agriculture based investment capital flows tend to the city, supporting agriculture investment imbalance, support to agriculture in the capital structure, as well as support for agriculture funding rate is not high, you will stand in the rural areas of the funds to come back. Then, with the negative effects of rural funds outflow be reverse demonstration, the rural outflow of funds is not only affect the unstable development of agricultural production and not conducive to maintaining the rural area of financial order which resulting in the emergence of the informal financial activities, but also hamper inhibition of urban and rural development, rural economic development, to speed up the dual structure in urban and rural economy, not conducive to the development of Agriculture and Industry. Based on this positive, you have verified the mechanism for establishing rural funds, and the necessity to rural areas and the establishment of the mechanism of funds raised suggestion, it is necessary to speed up the agricultural industrialization to improve the ability to absorb funds. By speeding up the construction of rural financial environment, it could improve the investment environment in the rural areas. By optimizing the rural financial service system, establish funds through a combination of input mechanism. Through the function of the use of Government funds, so as to reasonable to establish a mechanism for rural funds which to make funds reflow countryside effectively.