Research On The Capital Integration Of China-railway Industry With Financial Industry

As the infrastructural industry for the national economy, railway industry has the long-term and significant external effects on the coordinating of the regional economy. It's one of the most important basis of the other departments' development in the national economy. At present, railway development of China is still in the rising phase, which requires a large amount of construction funds. But the narrow financing channels accelerated the deterioration of railway finance. Meanwhile, the government-dominated financing system constrained the rapid development of the railway industry, in which the high interest phagocytosed the weak profits of railway sectors. Summarize the experiences of developed countries, we can found that in the early periods of railway construction, government offered the main construction capital; and with the rapid development of railway construction, the developed countries made full use of the capital market for financing. At the same time, railway industry of China has huge inventory assets, which need to be restructured with the structure adjustment of railway industry. In all, increasing effective funds input and accelerating the adjustment of huge inventory assets are arduous and urgent strategic assignments of railway industry in the future ten years.As the core of modern economy, finance, which has rapid operating funds, high level of capital appreciation and strong accumulation of capital, is referred as the bellwether of the virtual economy. The profit of finance is affluent, but if detached from the real economy, finance may have a significant risk. "Profit of railway industry is continuous but low, while that of finance is high but discontinuous." Therefore, the capital integration of railway and finance will benefit the both industries. On the one hand, it can promote the efficient circulation of the railway capital and make a tremendous benefit to the national economy. On the other hand, it can provide a stable resource to finance industry for value-adding and optimize the resource allocation of national economy. Combination of the two kinds of capital will constitute an effective way to each industry to develop mutually in market economy nowadays.Based on the analysis above, the paper selected the capital integration of railway and finance industry as the research subject. Based on the capital integration and incoming theory, this paper firstly makes a theoretical analysis on the motivation, the function and the form of the integration. And then on the basis of the theoretical analysis, this paper provides compares, through establishing relevant models, of the operating status, the financing cost and the earning status of the railway industry under several different kinds of the integration of railway and finance. The main innovations of this paper are listed as followed:(1)This paper makes a systematic study of the integration of railway industry capital and finance capital. The existing researches on this field are dispersive. Moreover, these researches mostly focus on the motivation of integration but few of them take further research on the function and form. This dissertation will make up for the shortcomings of existing research and carry out a study deeply and systematically on relevant issues.(2)This paper attempts to propose a theoretical proposition of the effective financing mechanism and gives a deep analysis of relations between the integration and the development of railway industry. The construction of effective financing mechanism has a strategic importance because the railway construction and operation costs huge capital. It can enhance the sustainable development ability of railway industry capital. Additionally, this paper provides evidence to analyse the perspective of structural financing, financing by capital market and the connection of policy-based finance and commercial finance.(3)Based on the existing theoretical studies, the dissertation proposes several forms of the integration. The paper propones that establishing a special railway finance company on the basis of capital settlement center is a practical choice to construct a primary organization form of the integration. Then the advanced organization form is a railway financial service group, which is a diversity stockholding company. It will promote the railway development, accelerate the transformation of the inventory assets, and enhance the earning ability of railway industry by providing comprehensive financial services.(4)The paper builds a capital integration earning model. The model building essentially is the integration of two different kinds of capital earning. One is industry capital with low risk but low earning, the other is financial capital with high risk but high earning. The key is to what extent the capitals integrate. The paper builds the model based on the financial capital earning model. This model can both analyze sole capital earning and risk and make fully account of the intrinsic value logic and value-added cycle appears after the integration. (5)The paper uses the historical and forecast data as envident to reason that the integration is the best choice to solve the financing problem, enhance the earning, and achieve the goal of leaping sustainable development. The paper builds three kinds of model including the current financing system, structural financing system and the integration system. Based on these models, this paper forecasts the main traffic and finance datum of railway industry between the year 2008 and 2020.