Application Of Industrial Investment Fund In Transportation Projects In The Context Of Urbanization

All along, the construction of transportation projects are the indispensable conditions for residents’normal life and production, but also an important guarantee for the development of the national economy. At present, China is in a stage of rapid urbanization. Meanwhile, the party’s18report proposed to promote industrialization, information technology, urbanization and agricultural modernization at the same time, including requirements "must improve the structure of demand, optimize industrial structure, promote coordinated regional development, and promote urbanization as the focus, make efforts to address the major structural problems which sustained the economy develop healthily." As can be seen, urbanization has become China’s current major trends. However, according to international experience, large sum of money need to be invested in transportation infrastructure at this stage. As a kind of quasi-public goods, the financing of transport projects has always been a serious problem. In this context, the paper studies the application of industrial investment fund in transportation projects, hoping to make theoretical contribution to the financing of transport projects.In this paper, I used the theoretical research method and empirical research method in combination. Based on the existing study, domestic and foreign theories related with industrial investment fund and the actual cases, I discussed application of industry investment fund in urban transportation projects under the background of urbanization.Innovation of this paper firstly is an active interest in hot spots combined with the current situation. This paper discusses the development of industrial investment funds of necessity, possibility and the specific use pattern from the perspective of urbanization. Secondly, different with previous researches which study industrial investment funds from the perspective of venture capital or investment instruments, this paper focuses on infrastructure investment funds and project financing of the problem. Third, the article does not talk in generalities, but chooses the most important and most urgent task of the construction of transportation projects to analyze the application of industrial investment funds.There are inevitably some shortcomings. First, since the investment fund industry in China has just started, is still in its infancy, so whether in theoretical or practical aspects are less studied. Meanwhile, the industrial investment funds are mostly private equity funds; there are certain limitations for available data on the quantity and quality. Second, because of my limited knowledge, there may be mistakes and deviations in the analysis of the course. So this subject needs to be studied by more scholars in further. Third, since there is inevitably distance between the theory and practice, during the process of the application of theory, there may be a lot of problems which are not considered before, and with different specific cases arising discrepancies with theories, so this topic will also need to perfect theory after practice lessons.This paper is divided into six chapters. The detail is shown as follows:Chapter One:Introduction. This chapter introduces the background and significance of the topic, reviews the research at home and abroad simply and describes the research methods and the main research content.Chapter Two:Related Concept Definition and Theoretical Basis. This chapter begins with the basic concepts involved and analyzes theoretical foundation of industrial investment fund used in transportation projects from the aspects of Northam curve, public goods theory and principal-agent theory.Chapter Three:Industry Investment Fund for the Construction of Transportation Projects Feasibility Analysis. This chapter begins with the current development of industrial investment fund in our country, and analyses reasons for its slow development in China. Combined with current situation of industrial investment fund in China, this chapter demonstrated the feasibility of the use of industrial investment funds in transportation project.Chapter Four:the Operation Mode of Industrial Investment Fund Used in Transportation Projects in Cities and Towns. This chapter analyses and compares systematically from the aspects of initiation, fund raising, organizational forms, management and exit channel, expounds the appropriate operation mode for China’s urban transportation projects.Chapter Five:Experiences Abroad-the Australian Industry Investment Fund as An Example Analysis. As China’s industrial investment fund is still in the exploratory stage, this chapter mainly studies the development of Australia’s case as a mature industrial investment fund, in order to provide experience for our reference.Chapter Six:Countermeasures and Suggestions. On the basis of the previous chapters, proposed some countermeasures and suggestions.Based on the above analysis, I reached the following conclusions:First, the construction of transportation projects becomes the focus in the current context of China’s urbanization. Development of industrial investment fund for transport projects is not only able to compensate shortcomings of existing financing model, but also provide a better investment channel for private investors and institutional funds.Secondly, industrial investment funds in China are still in its infancy, the pilot operation of the Fund met with some difficulties. However, due to market condition of transportation projects itself, the establishment and improvement of laws and regulations for industrial investment funds, extensive civil funding sources, and building of multi-level capital market, china has already have the feasibility to use the industrial investment fund in transport projects.Third, at this stage, the transportation projects industrial investment fund are mainly organized in limited partnership type, raised by way of private fund. But it should transfer to company type and the mode of public offering gradually. Operators should choose the right investment strategy, asses the benefits and risks of the project carefully and take a variety of ways to invest. On exit, the main choice at this stage is to go public in the small and medium-sized plate and GEM board; the next step should be finding a way to list the fund as a whole on the market.Fourth, during the process of using the industrial investment fund in transportation project, we should distinguish the boundaries of government and market; give full play to the role of industrial investment fund market function. What’s more, we should attract more investors by solving the problems of income compensation and two-level agency problem. Above all, professionals need to be nurtured to support the development of the fund in the future.