Research On Early Warning Of Local Government Debt Risk In Shandong Province

Since the reform of tax-sharing system,the game between central government and local government on financial power and power has continued.Under the situation of shrinking financial power and expanding power,local government has opened up a "land finance" development model to meet its own financial expenditure and economic development needs.However,in the face of the growth of public service expenditure and the enormous development pressure of industrialization and urbanization,local governments began to borrow a lot of debts using related investment and financing platforms.All this strongly supports the development of regional economy,but the hidden debt risk is becoming more and more serious.The huge scale of local government debt has brought increasingly severe pressure on debt repayment,and the related problems still exist: the insufficient scale of new government debt in some areas may cause local governments to issue debt illegally or use other illegal financing methods;the low success rate of the promotion of the government and social capital cooperation(PPP)model;the general lack of long-term budget planning in various regions,and the financing methods.Reform and innovation lack exploration.It analyses the scale and structure of local government debt in China,and deeply understands the local government debt situation and regional economic development of each prefecture-level city in Shandong Province.Through index analysis method,fuzzy mathematics comprehensive evaluation method and principal component analysis method,it measures the debt risk of the provincial governments,and constructs a risk early warning system on the basis of empirical results.Finally,based on the specific situation of local government debt risk,it provides policy advice for the monitoring and prevention of local government debt risk.Empirical research found that: in 2017,Jinan,Heze,Rizhao,Linyi and Laiwu have less debt risk,Zibo,Liaocheng,Qingdao,Weihai,Dezhou,Dongying and Yantai have moderate debt risk,while Weifang,Jining,Zaozhuang,Tai'an and Binzhou have higher debt risk;for those cities with less debt risk,their debt structure,place and so on.Fiscal and regional economic development tend to perform better;in areas with severe risk,they tend to perform poorly in terms of debt structure and regional economy's dependence on government debt.To prevent and control the local government debt risk,we need to accurately grasp the general development direction of combining optimization of fiscal revenue,control of fiscal expenditure and system plugging,and strengthen the examination and approval constraints and financial budget and final accounts mechanism.On the one hand,the financing system,financing tools,financing channels and financing structure should be continuously improved to maximize the efficiency of financial guidance and leverage,so as to enable local government financing to enter the track of benign circular development;on the other hand,the transparency of local government debt raising should be strengthened,and the departments of revenue and expenditure plan,project details and principal and interest repayment of local infrastructure projects should be strengthened.To improve the financial management system of local governments,we should take the principle of matching the debt of local governments,the level of regional economic development and the financial sustainability of local governments as the principle.