| On the occasion of the two sessions in 2018,the "Proposal on Resolving China’s Local Government Debt Risks Proposed by the China National Democratic Construction Association" revealed the local government debt risk problem.Unclear responsibilities,non-transparent information and high hidden risks cause the situation that some of the major risks of local government debt continue to arise and become more hidden.Faced with such a huge amount of government debt,the PPP model can increase the supply of infrastructure and public services,strengthen the government’s public management,improve the level of local government debt management and reduce the risk of debt.Sewage treatment projects have the dual attributes of public services and urban infrastructure.Sewage treatment projects have been faced with various problems for a long time,.The government is unable to build,and social capital is reluctant to invest in this area,resulting in insufficient long-term supply of public services for sewage treatment.On October 11,2016,the Ministry of Finance issued the "Circular on Deepening the Work of Government and Social Capital Cooperation in the Public Service Sector." It pointed out that in the public service areas supported by the central government,it is possible to explore and develop two areas based on industry characteristics.In the areas of public services such as waste disposal and sewage treatment,new construction projects will be forced to apply the PPP model,and the central government will gradually reduce and cancel subsidies for special construction funds.Due to the characteristics of multiple modes and complex structures in the PPP model,together with the emergence of new PPP models represented by the Beijing Metro Line 4 in recent years,a variety of PPP modes have been put in place.It is particularly important how to combine practical options with more feasible solutions.Under the current environmental background that the sewage treatment project faces the policy background of mandatory implementation of thePPP model and the overall goal of wastewater treatment has not yet been achieved,it is imminent to conclude and compare various PPP models,and to select the optimal plan in light of local conditions.Local government debt risk is an important basis for determining the PPP model.Only comprehensive and systematic theoretical research and comparative analysis of various PPP investment and financing models can effectively select the investment and financing model in future PPP projects.This article summarizes the domestic and foreign research literature,sums up the research results of PPP model at home and abroad,bases on the status of local government debt risk,analyzes the application scope and risk prevention of PPP model,and introduces the case study of PPP model in China’s wastewater treatment field.Theoretical research,based on principal-agent theory and other theoretical models,introduced the characteristics of investment and financing of the PPP model and the financing model,focusing on the comparison of different investment and financing model determination basis and the debt risk assumed by the local government.Debt risk is divided into two parts.First is the government’s existing debt and debt risk in project planning.Second is the local government debt risk brought by the project.The debt risk studied in this paper is the accumulation of both.In the final case analysis section,we compare the cases of sewage treatment of major modes such as BOT,TOT,and PPP,analyze specific investment and financing models,and summarize local government debt risks under different investment and financing models.It provides a reference for future investment and financing model choices and plays a role in reasonably controlling local government debt risk while providing high-quality public services.It has certain theoretical and practical significance.and tries to put forward feasible measures to control the local government debt risk in PPP projects. |
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