The Research On Financial Support For The County Economic Development In Undeveloped Area

In2012, county economy was put forward to achieve new objectives and requirements onthe report of18th Party Congress. Developing the county economy is the key to build a well-offsociety roundly, to promote the development of new urbanization. Finance, as the core of moderneconomy, realize the function of effective capital allocation, and play a decisive role in the supportof county economy development. How to make the county finance effectively support the countyeconomy development, is paper’s the emphasis and difficulty.Taking Xiushui County of Jiangxi Province for example, we study the situation of countyeconomic and financial development in the undeveloped areas. Using the1993to2012economicgrowth and financial development index data to make the empirical research, we analyze that thereis a significant positive correlation and Grainger causality between the county economy andcounty finance in the area. In the short term, there is a causal relationship of mutual promotionbetween the county economy and county finance. From the long term perspective, thedevelopment and deepening of county finance is the cause of county economic development. Inhence, the effective financial support for the development of county economy has undoubtedlyimportant role.However, after studying the current situation of financial support for the county economicgrowth in developed area, we analyze the county financial existing problems from the perspectivesof supply and demand. The reasons are summarized as the weakness of county economy, thedefect of county financial system, the unreasonable credit structure and the poor financial systemenvironment. By drawing on the successful experience of the financial support to the countyeconomic development in developed area, and considering the undeveloped county’s owncharacteristics and the current situation of its economy and finance, we put forward somesuggestions to improve the county financial support. Establishing the perfect county financialservice system, strengthening financial policy support, establishing the credit guaranteemechanism to improve the financial environment, and optimizing the credit structure, to promotethe development of undeveloped county’s economy and finance, and then to promote theintegration of our country’s urban and rural economy, to drive national economy’s sustained andhealthy development.