The Risk Situation And Countermeasures Of China’s Local Government Debt

Recent years, foreign institutional investors and rating agencies frequently warning of the risk of China government debt, following the Fitch rating the long-term local currency credit from AA-tune to A on April16,2013, Moody’s confirmed the Chinese government bonds rating to Aa3, and the rating outlook. from the front to Stable. The international rating agency downgrades mainly based on the rapid growth of China’s government debt and credit. Held on April25,2013meeting of the Political Bureau of the CPC Central Committee is also concerned about the matter, and pledged to "pay close attention to the establishment of a standardized local government debt financing mechanism". Banking Regulatory Commission in April2013bursts on the8th andlOth,which are associated with local government debt. No.8points to shadow banking is a lot of local construction project depends on the financing channels, the10th is point directly to local government financing platform. Visible, central government departments have been highly concerned about the risks of local government debt,In recent years, the scale of local government debt continues to expand. On the one hand to meet the demand for capital, on the other hand is not standardized so that the risks continue to be amplified. In the above context, the paper, on the basis of the study of the status quo at home and abroad, China’s local government debt as the research object, through the use of a comprehensive analysis, comparative analysis, logical analysis method to study China’s local government debt situation, existing risks and reasons for the formation, and learn from the experiences and lessons of the foreign local government debt management came to the conclusion to resolve the short-term tasks and long-term goals of the government debt risk.In this paper, the status of local government debt, combined with the current economic development of China’s overall situation, to draw the overall risk control of China’s local government debt, but highlights the risk of the local. Scale expansion and management of local government debt is not standardized, tne risk of default, will bring about financial risk, financial risk, efficiency risk and social risk. Then the paper analyzes the reasons for the formation of local government debt risk, mainly the current fiscal management system is not perfect and Local Government Management System specification two. As China’s local government debt in a short time, lack of management experience, learn from the developed countries, the United States and developing countries Brazil two countries local debt management experience, and came to the revelation of China’s local government debt management. On this basis, this paper draws the short-term tasks and long-term goals of preventing and resolving China’s local government debt risk. In the short term is to establish information disclosure system of local government debt, to control debt incremental, gradually digest the stock and the establishment of local government debt risk early warning mechanism. The main tasks include long-term arrangements to improve the legal system and rules, to adjust the intergovernmental fiscal relations, and the establishment of a full range of local government debt supervision and regulatory system.