State Grid Corporation Of Long-term Financing Options For Study

State Grid Corporation of China is an important state-owned enterprise that concerns national energy safety and economy.It is also the largest utility in the world.The core business of SGCC is to build and operate the state grid,contributing to the development of the country by providing safe,economical,clean and sustainable electric power supply.According to the general requirement of building well-off society,SGCC has set down "the 11^th Five-year Plan" and "2020 Prospect" of the company.During the period of 11^th Five-year(from year 2006 to year 2010),the whole scale of investment in state grid building will up to around 900 billions.Whether we could finance sufficient capital in time and by what way to finance will largely determine the achievement of the goal the company has set.It is a baptism of financing capacity for the fact that the company had never been faced with such a substantive capital demand.With reform of electric industry system,both the macroeconomic and microeconomic conditions are changing rapidly and significantly.Find out the most effective financing strategy by accommodating to the development and adjustment of the economy and national policies as well as playing the advantage of SGCC has been an key issue of SGCC to solve.The article is based on the practical evidence of "the 11^th Five-year Plan" set by SGCC and Capital Structure Theory in Western Economics.It analyzes the economical, financial and political surroundings faced by SGCC and refers to the liability structure and financing characteristic of other electric enterprises in the World Top 500.Finally,by comparing advantages and disadvantages of all the financing approaches,internal and external,it finds out the principles for SGCC financing and puts forward a relatively practical and optimal mid long-term(year 2008 to year 2010) financing proposal.