Risk Problems And Countermeasures Study Of Local Government Bond Financing

Under the guidance of the Chinese government,Local government loan financing has officially started. Accelerating the investment, financing system and promoting investment is the current overall trend of economic development. As the practice progresses, the mode of financing local government reflects the diverse nature, and bring a range of issues. To some extent, it affected the size of local government finance and efficiency. In theory, local government loan market financing is the inevitable result of the process;from a practical perspective, the local government loan financing is the reality of China’s financial system reform requirements. Local government loan financing for the central and local levels are able to finance the objective difficulties to function effectively and improve of China’s capital market.Currently, changes of local government financing mode has caused attention in society and local levels of government. The standpoint of this study is based on the current financing model of local government status, analysis of patterns of local governments in financing the main problems, summarize and conclude the local government bond financing models and measures of development. This makes the local government finance in accordance with the diversified, market-oriented, standardized way of doing business and healthy development.Through the reference of successful experience of local government bonds on international market, real analysis financing of local the domestic government bonds market, this paper studies with Chinese characteristics, the financing of local government bonds market development strategy, made against the local government bond financing of various risks. This will help straighten out a reasonable central government and local government financial relations, but also solve the problem of funding local economic development. This paper discusses the local government financing model, the advantages of bond financing and risk prevention and other issues.By analysis the systematic risk of the local government bond financing, This paper promotes the effective measures which prevention of risks but also healthy local of government development of bond financing. Related measures include: scientific definition of the size of local governments to issue bonds; creation of specialized regulatory bodies to strengthen local government management and supervision of the issuance of bonds; improvement of the legal protection of the local system of government bonds; fostering local bond rating market and accelerating the construction of credit guarantee; Establishing local government bonds debt service mechanism and improving the information disclosure system construction.