The Risk Assessment Of Local Government Debt In Gansu Province

In recent years,as China's economy has entered the new normal,and the economic growth has changed from the previous high speed to the current high speed,the debt of the local government has been increasingly prominent,which has attracted the attention of the domestic scholars,the party and the government.In the second half of 2017,the nineteen and central economic work conference of the Communist Party of China put forward a more strict management of local government debt,and put forward "keep the bottom line of systemic financial risk" and "strengthen the management of local government debt".All this shows that our government's attention to local government debt has risen to the high level of the country.Gansu province is located in China's economic backwardness and the fragile ecological environment in Northwest China in recent years,along with promoting "The Belt and Road" and the national supply side reforms before 2016 of each year,the economic growth of Gansu province high speed to maintain a good momentum for the development of the local economy and China's poverty alleviation task has made tremendous contributions.But while seeing higher economic growth,it should also be seen that the base of GDP(gross domestic product)is smaller and is at the end of the provinces.In particular,GDP growth began to slide sharply in 2017,only 3.6%.Low economic growth,which may lead to lower regional investment and brain drain,will also deepen the repayment pressure of existing debt.This article is based on the evaluation of local government debt in Gansu Province as the focus of the study,using empirical analysis of the data available to the public in local government debt risk status in Gansu Province,and through the model to calculate the possible default probability,the last research results as the basis to put forward suggestions and effective countermeasures.The main research contents of this paper are: firstly,this paper reviewed and combed the literature representative of a large number of domestic and foreign,clarifies the connotation,the risk of local government debt and the causes and brings;secondly,starting from the relevant theory of local government debt,the actual situation and local government debt in Gansu province the detailed description and analysis of the causes of local debt scale of Gansu province;thirdly,the KMV model and the extended model of the mainstream local debt credit risk assessment in Gansu Province,the local debt risk analysis and evaluation of credit.Finally,through the empirical analysis of the present situation and the local debt of Gansu Province,this paper gets the following conclusions: first,the central government transfer payment in the absence of this factor,the government of Gansu province in 2017,debt and income ratio of 10%,government debt default risk,and debt service accounted for 5% of revenue,the government the debt default is inevitable.Under the same conditions,the local debt of the Gansu provincial government broke up in 2018.Second,through modifying the KMV model,the government of Gansu Province,the local debt in 2017 but there is no risk of default,but in 2018 but due debt default risk;third,according to the probability of 0.4% default security line in Gansu province accounted for debt calculated public budget revenue ratio of 30%,20%,15%,10% and 5% of the highest debt safety limit were 12 billion yuan,11 billion 219 million yuan,10 billion 829 million yuan,10 billion 439 million yuan and 10 billion 48 million yuan.Based on the empirical results,this paper argues that the default risk of local government debt in Gansu province is bigger in 2018.It needs high attention and vigilance from provincial governments and provincial governments at all levels,so as to do well in risk prevention.Finally,through the basis of local debt risk prevention at home and abroad experience,combined with the actual situation of Gansu province in the region,puts forward effective countermeasures to resolve local government debt risk in Gansu province and feasible suggestions: one is to establish and perfect the scientific and effective local government debt supervision and management system two is relying on the "The Belt and Road" to carry out the PPP project and the Lanzhou New District,the optimization of government budget management,government debt is smooth;three,introduction of local credit rating and risk warning system;four,implement bonds also spontaneously.