Study On The Forest Tenure Mortgage Loan

Forestry has tremendous ecological, economic and social implications, and plays strategic roles in our country’s economic and social development. Our natural ecosystem and environment have been greatly damaged due to the rapid deforestation throughout the world. In recent years, forest industry has gained increasing attentions and been well recognized as a significant factor in the international political and economic areas. As an indispensable part of the environment protection, a sustainable development of forest industry is beneficial to our economic development, as well as the improvement of our ecological environment. However, compared to other industrial fields, forest industry normally has longer production period, lagged revenue rates, and longer period of capital recurrence. Meanwhile, forestry is also greatly affected by unpredictable weather conditions. As a new type of mortgage loan, the forest ownership title loan poses higher risks to the operation of forest cultivators and enterprises. Presently, financial difficulty has become a major limitation to the income increase of forest households and the development of forest enterprises.The Forest Tenure Mortgage Loan is a product of the reforms of collective forest tenure system. It aims to promote forestry development by providing financial supports and inspiring enthusiasms to forestry investors. The policies of Forest Tenure Mortgage Loan provide forestry operators with more financing channels, and are helpful to reduce their capital pressure. However, the discrepancy between the services provided by financing institutions and the needs of foresters greatly limits their capital flows, and restrains the development of forestry.In this paper, we briefly introduced the concept, constitution and existing patterns of the Forest Tenure Mortgage Loan. Then we further analyzed the problems and obstacles existing in the Forest Tenure Mortgage Loan, and proposed possible resolution strategies. Based on the field survey of the situation of the Forest Tenure Mortgage Loan in HM County of Shandong, combining with the latest literatures, we proposed a variety of resolutions to improve the current Forest Tenure Mortgage Loan system, such as to improve the policies on discount loan, set appropriate mortgage rate, loan term and interest; actively prevent and/or reduce the risk of Forest Tenure Mortgage Loan; systematize the transfer system of forestry tenure and increase the liquidity; and enhance the publicity and coverage of Forest Tenure Mortgage Loan, et al.Based on the comprehensively empirical analysis of obstacles in Forest Tenure Mortgage Loan, we suggest that government departments, financial organizations and related functional divisions collaborate to resolve the encountering problems in the Forest Tenure Mortgage Loan, to booster a sustainable development of the county economy and rural finance in China.