The Research On Financing Risk Management Of Chongqing Chinese Funded Project Platform Based On Fuzzy Comprehensive Evaluation Method

In recent years,the sustained deterioration of the state of the global economy has endured constant deliberation by industry academics and scholars alike.Following the wake of the subprime crisis and the Greek debt crisis,global repercussions have followed suit;affecting developing nations such as China especially.The central government has facilitated the Chinese economy transitioning from a planned economy to a market economy by allocating public finance expenditures.As a direct result,the local government revenue and expenditure gap have increased and debt has expanded rapidly,as have the rates of inflation;incurring huge losses for the nation.Despite such grim circumstances,a series of reforms instituted by local governments in 2012 have largely remedied the situation,simultaneously resolving the debt crises efficiently and promoting sustainable economic development and social stability.As demands for the construction of infrastructure increase,local governments have had to rely on local platforms for financing due to local and central level restrictions on allocation.This paper elaborates the background of the issue and its significance,based on project management processes and risk management theories and subsequent models.Furthermore,it will combine local and central level financing platforms and its subsequent specific projects while analyzing unique local financing platform characteristics.In particular,it notes the efforts of the local government in creating and facilitating a financing platform and its special relationship in regards to other corporations.Because of these special relationships,we have included emphasis on the initiative and control exhibited by the local government in the overall evaluation of their efforts.Based on fuzzy comprehensive evaluation methods,we built a system of risk management using index evaluation;one that could efficiently evaluate external control environment,financial indicators and three types of internal management environments.Furthermore,throughout platform construction we isolatedtheestimated risks within and established a series of indices including secondary and tertiary factors with a total of 23;and finally employed this model on a specific financing platform corporation – Chongqing state-owned Assets Management Co.,Ltd.and evaluated its overall risk level.We concluded that,utilizing our indices,that the economic and law environment all posed significant threat to the profits of Chongqing state-owned Assets Management Co.,Ltd.,increasing risk and risk managing difficulty.In the area of external control,the nation's fiscal and monetary policy and GDP growth all bore significant effects on the corporation.Lastly,in regards to the local government environment,Chongqing state-owned Assets Management Co.,Ltd.would be affected by a myriad of factors such as: local debt dependence,Self-sufficiency rate of local finance,local monetary policy growth rate,local government level,policy effects on local area growth,and local area GDP growth indices.Standing from the perspective of Chongqing state-owned Assets Management Co.,Ltd.,the future of its development devoid of government factors will ultimately still be affected by its internal management system,the condition of this managing,and financial indices.This paper utilizes the experiment on Chongqing state-owned Assets Management Co.,Ltd.risk management and summarizes current financing platform risks within China.From the two perspectives of the government and corporations,improvements are as follows: 1)perfect the system of state financing platform risk prevention;and comb the government finances open evaluation mechanism whilst peeling back restrictions on the government bond market.2)strengthen the government's ability to reduce the risk of debt;establish diversified financing channels,and strengthen the government's financial resources and control of local government's financial scale.3)strengthen the financing enterprise's ability to avoid financial risk,perfecting the financing of local government institutions of real-time changes in debt monitoring systems whilst strengthening local government financing institutions for risk control ability construction,and raising the level of risk control in the financing of local government institutions.