Research On "Insurance+Futures" Targeted Poverty Alleviation Innovation Model

Eliminating poverty,improving people’s well being,completing the building of a moderately prosperous society in all respects and eventually achieving modernization and prosperity for all are the basic requirements of socialism with Chinese characteristics.They are also the important goals for the Party to lead the Chinese people to realize the great rejuvenation of the Chinese nation in the next century.The idea of “targeted poverty reduction and alleviation” is an important part of Xi Jinping Thought on Socialism with Chinese Characteristics for a new era and the essence of advancing key plans for poverty alleviation.It is rich in content and high in meaning,as the important guiding ideology and principle of winning the tough battle against poverty.On different occasions,General Secretary Xi Jinping repeatedly stressed that it is necessary to adhere to targeted poverty reduction and alleviation,enhance policy implementation efforts,increase financial and land policy supports,and strengthen poverty alleviation actions ranging from transportation,finance and education.Under this background,the “Insurance + Futures” targeted poverty alleviation model is an innovative model explored by Chinese financial market to support poverty alleviation.It is also an important measure for China’s relevant financial institutions to serve the real economy and the country’s poverty alleviation strategy.At present,Lincang,Yunnan Province has carried out innovative practice of sucrose Futures Price Index Insurance in targeted poverty alleviation,which provides a good material for the research of the innovative model of "Insurance + Futures" targeted poverty alleviation,and also accumulates rich experience in the practice and application of that innovative model in other regions.Therefore,this paper chooses the sucrose industry in Lincang,Yunnan Province as the research object to study the "insurance + futures" targeted poverty alleviation innovation model,which has great practical value.This paper takes the innovation practice of the Futures Price Index Insurance in sucrose industry in Lincang,Yunnan Province as the research object,and the "Insurance + Futures" targeted poverty alleviation innovation model as the research content.The research methods that are mainly involved in this analytical research are literary analysis,case study,and comparative analysis.Firstly,after combing and summarizing the literature on subjects such as "targeted poverty alleviation" and "Insurance + futures" at home and abroad,this paper expounds the related concepts and theories of "targeted poverty alleviation","financial poverty alleviation" and "Insurance + Futures".Secondly,we analyze the implementations of "Insurance + futures" targeted poverty alleviation innovation model in the sucrose industry in Lincang,and we found that the innovation model has the following main advantages in the practice of targeted poverty alleviation in Lincang.Firstly,it lowers the threshold of entering the agricultural product futures market.Secondly,it effectively integrates the decentralized micro-agriculture bodies to achieve economies of scale.Thirdly,it relieves the risk of sugar price fluctuations.And to protect the interests of sucrose farmers from loss,the establishment of a multi-party linkage mechanism improves the overall operational efficiency,stabilizes farmers ’ income and supports the targeted poverty alleviation,etc.Finally,we give our commendations on critical issues that exist in the "Insurance + futures" targeted poverty alleviation innovation model.For instance,according to the different participants in the "Insurance + futures",the vast number of farmers do not understand the agricultural insurance;in the futures market,the variety of agricultural products is limited,the exchange-traded options is lacked;and the scope of insurance companies’ price guarantee is narrow,the cost and risk of transferring price are high;at the national level,the state’s financial support is not enough,the premium paid by farmers is high and the supervision system is imperfect.To solve these issues,we advice to carry out special training,improving farmers ’ risk awareness and their understanding on risk management tools,listed futures options products,to perfect the trader structure,expand the main body of protection,introduce bank credit funds,increase subsidies,guarantee mode operation;and at the regulatory level,give full play to the power of regulatory integration so as to raise the efficiency,and other corresponding specific policies recommendations.In doing these,we hope to provide reference to other regions in the use of “Insurance + Futures” targeted poverty alleviation Innovation model.