Research About The Law Regulation Of Chinese Local Government Debt

The budget law of the People's Republic of China has changed in 2014,which empower provincial government borrowing rights,this is first time the central government relax the local government issue bonds.The local government debt has a solid theoretical foundation and practical value,but because of local government debt has the possibility of credit risk,financial risk,political risk,it is necessary to strengthen the legal supervision of local government debt.Chinese local government debt is mainly consist of 3 borrowing mode: financing platform,the central undertakes,local government sell bonds,which leading to the characteristics of local government debt as huge borrowing,structural imbalance.Based on legislative and practical situations of local government debt,these are some defects in legal framework,supervision organization,information disclosure,risk control of the local government debt law regulation.In order to carry out a unified management system of “borrow,use,return”,we need take some macroscopical system construction.Firstly,establish the overall plan,implementation path,basic principle of law regulation local government debt.Secondly,promote the improvement of budget law,security law,securities law and other law and regulation,formulate government bonds law.Thirdly,consummate the regulator of local government debts,set up supervision institution,strengthening the multi-sectoral coordination.In order to carry out a unified management system of “borrow,use,return”,we need take some specific measure.Firstly,strengthen local bond issuance supervision,draw lessons from the market leading pattern of U.S and administrative control of Japan,perfect the system of bond issuance and supervision of our local government debts.Secondly,Learn from the European debt crisis,which has exposed the debt risk of management issues,then,perfect our debt risk management mechanism.Thirdly,analyze 3 different borrowing models,and put forwards several ideas to local debt repayment mechanism in China.