The Enlightenment For Chinese Government When They Resolving The Local Debt Troubles

The local debt problem has been a highlight in the development of market economy. In order to prevent the local government borrowing accounts in a mess, since 2013, local government debt will become the important index for official achievements appraisal. For strengthening the local government debt management, guarding against systemic debt risk, the purpose of the state council issued in September 2014 file "of the state council on strengthening the opinions of the local government debt management, guo fa ([2014] no.43), local government financing platform shall not raising new debt. No.43 release broke the old debts to local governments in the past for new debt repayment traditional service mode, they face huge financial pressure, more directly lead to more government into an insolvency bottleneck years in 2015.Therefore, the local debt due to reasonable treatment to reduce the debt burden of local governments, to avoid systemic debt crisis, it is our urgent task.This article is based on the existing research literature at home and abroad, overseas experience, on the government’s handling of local debt problems of local government debt restructuring in China’s history, current situation, problems and future development direction of local debt problem research and so on. With " THE DEBT RESTRICTING OF H CITY " as an example, from the angles such as project risk, income source for local government and non-bank financial institutions to carry out the feasibility and security of the debt restructuring project were analyzed, and the local government debt restructuring in the problems existing in the actual operation and hidden danger:high interest rates increased the city for the enterprise the management pressure, the project is under suspicion of regulatory arbitrage, hinder relevant institutions of statistics and management of the government debt, the greater the probability of systemic debt risk outbreak. Corresponding Suggestions are put forward based on the above risks:urban construction investment companies should try to reduce operating costs, strengthen the supervision of local government financing platform financing channels, the reasonable control of fiscal expenditure, reduce the fiscal deficit.