The Operation Mechanism Of Infrastructure Industrial Investment Fund In Sichuan

Under the new domestic economic normalization that Sichuan traditional industries (major equipment manufacturing, wine, oil and gas industry, mining, etc.) are less competitive, the increase in fixed assets investment in infrastructure is an effective means of maintaining economic growth. However in recent years, with the deepening of the reform of financial and the rise of prudential supervision, the traditional infrastructure investment and financing models which rely on credit, BT and other means to carry out to an end, and the direct financing, PPP, etc. modes that the current regulators strongly appeals to are also difficult to fill the financing gap in a short time, so it is difficult for the government to solve problems in direct financing of infrastructure through borrowing, under this circumstances, the establishment of infrastructure investment fund in Infrastructure will fully absorb the social capital and will not increase the debt burden of explicit, for the government. But it also allows the government to enjoy the leverage revenue through structural design. It enhances infrastructure investment and financing management efficiency as well. So that the aforementioned dilemma solved. It can be expected that the infrastructure investment fund which is emerging investment and financing mode will be considerable development and widely used in Sichuan Province, and its development potential is enormous.As in the development of infancy, yet there is no systematic definition of the Infrastructure Investment Fund, it has usually confused with venture capital funds, private equity funds, even funds and securities investment and other financial products which resulting lack of supervision and other issues. In addition, directly researches results both domestic and abroad on Infrastructure Investment Fund are less, the existing literature is mainly descriptive analysis,but the main theoretical system and the system of complete research framework have not yet formed. In this case, choosing research on the operation mechanism of infrastructure Investment Fund in Sichuan of not only has profound practical significance, but also to enrich the academic research in this field.In the research framework, this paper firstly clarifies the investment subject matter, namely, the connotation and extension of infrastructure. On this base, we define the infrastructure Investment Fund:it sets up the project operations in infrastructure field (including infrastructure project design, construction, management, etc.) and capital projects (direct corporate equity related infrastructure projects, debt, asset-backed securities, etc.) as specific investment subject matters and to raise private equity funds through non-public subscription from qualified investors in particular institutional investors or individuals funds, it is a generalized industrial investment Fund. In the following, we analyze the operating mechanism of the Fund by combining theory and practice of investment, economics and finance, we found three major characteristics existing in Sichuan Infrastructure Investment Fund, namely market, Administrative and Structured. These characteristics are determined by the internal architecture, market competition and infrastructure pricing strategy of the infrastructure Investment Fund. On this basis, this paper takes the perspective of industrial organization as a starting point, relying on the basic analytic framework of industrial economics and regulation economics, using research methods of game theory, agency, mechanism design, corporate governance, market competition to establish mathematical models to systematically analyze the three main decisive features of Sichuan infrastructure industrial investment Funds.There are three main innovation points at this paper:(1)Developing the framework which analyze the mechanism of infrastructure industrial investment funds in Sichuan.. Based on theory of market structure and of new industrial organization, this framework consists of Internal architecture, strategy for market competition and pricing mechanism of infrastucture.(2)Researching how the different type of infrastructure influence operation of infrastructure industrial investment funds under the condition of market segmentation.(3)Analyzing the pricing mechanism of infrastructure industrial investment funds when local government is playing a double role and the limited partner is mezzanine capital.