Local Government Debt Risk Research In China

Local debt risk is an important factor affecting the stability of the world economy.2008 international financial crisis,China's central government immediately issued a "four trillion"economic stimulus plan for,at this time in response to the call center local governments have to raise more funds to cope with the economic stimulus plan.Thus,since 2009,China's local government debt risk aroused widespread concern.According to relevant statistics,as of the end of June 2013,China's local government debt has reached 18 trillion scale.Whether such a large debt will trigger a new round of economic crisis that we can not avoid the topic.According to China's "budget law",China's local government has no authority to issue bonds,at the same time the needs of local fiscal expenditure has continued to increase in the central government's policy to stimulate and constantly exaggerated the dual role of economies of scale,so local governments It can only be financed tlnough various financing channels.Therefore,local government debt have been expanding,but with the support of regulatory and compensation system construction is relatively backward,lack of debt and debt service continues to expand the system in stark contrast,such a huge debt risk if they are not to be studied and regulation,it will inevitably result in a serious impact on China's economic development and social stability.Firstly,the theory of government debt mainstreaming has combed and enumerated,including the famous bond theory and the theory of fiscal decentralization can provide theoretical guidance for China's local government debt risk management.Among them,the fiscal decentralization theory is embodied in our tax reforminl994.The tax reform is an important aspect of the central and local powers and expenditure responsibilities of problems.Which continues to expand and the limited nature of the case of local government revenue expenditure responsibilities is particularly prominent.The second part of the paper size and current situation of local government debt on a more detailed analysis,the paper pointed out that as of the end of June 2013,the total size of China's local government debt has reached 17.9 billion in size.Even taking into account the regional imbalance of economic development in China and a series of factors,but the total amount of local debt year by year growth trend is undeniable.Although the local government debt to some extent to meet the funding needs of social development,but hidden behind the huge size of the debt can not be overlooked.For more accurate quantitative analysis,the paper uses the intertemporal budget constraint model to discuss local government debt is sustainable in the long run under,and then to the local government debt risk warning provide policy basis.The third part of this paper,based on learning from international experience analyzes the scale of China's local government debt continue to accumulate reasons,of which the objective requirements of Local Government Debt supporting system is imperfect development of industrial urbanization is the most important for two reasons.From an economic point of view the development process of countries in the world,expanding the size of local government debt is inevitable,so how to regulate the system of local government debt,thus ensuring the solvency of the government's credibility and it becomes very important.The last part for the current local government debt risk presented corresponding countermeasures.Article that first must be a reasonable increase revenue by improving local government revenue and expenditure structure,increase the local government's solvency.Secondly,it should be recognized as soon as possible a legal form of local self-government borrowing behavior,and it accounts open and transparent,easy to control.Finally,we must improve the local government financing and regulatory system,and the evaluation mechanism and evaluation mechanism to implement into practice.