| Local government financing platform is an innovative financing mechanisms. The platform solved the Contradictions between the local economic construction and the relative shortage of funds. At the same time, It also led to a high degree of attention of all parties, for it associated risks.This article comprises of six parts.The first part is introduction of the paper, first, the background and significance of the study; secondly, the methods and basic framework of the paper and finally the literature review.The second part is the present conditions of the local government financing platform. firstly, we introduce the meanings and classification of the platform; secondly, the development process and the role in economic construction;finally, the common problems of the platform.The third part of the paper is the theories of the commercial bank credit and government financing. Firstly, we analysis the interrelationship between the bank and finance, from two contrary theories, the financial deepening and financial repression; secondly, the basic principles the commercial bank must stick to when lend to local government; thirdly, the normal financing channels of local government in the market-oriented economy; finally, the successful financing mode of foreign government.The fourth part of the paper takes the commercial bank platform consumers of one city in Sichuan province as an example, explains the present conditions and existing problems of the platform, discusses the basic credit conditions in detail, analysis the causes of the conditions deeply, and put forward problems form the view of commercial bank.The fifth of the paper make a detailed analysis on the risk caused by the platform, the emphasis s the analysis of the finance guaranty risk.In the last part of the paper, we put forwards some recommendations to control the risk, include enhancing management of local government financing platform, finance, bank and expanding market financing channels. |
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