The Private Capital In Quanzhou Under The Background Of Financial Reform: Scale, Flowing And Financial Effect

Private capital as a part of the social capital circulation, with the characteristics ofuniversality, convenience and flexibility, it not only makes up for the deficiency ofthe formal financial, but also plays an important role in promoting the optimizingallocation of social resources and economic development. Quanzhou is one of thethree central cities in fujian province, the private economy of Quanzhou is verydeveloped, and the scale of private capital is abundant. After Wenzhou and PearlRiver Delta, Quanzhou became the third financial reform pilot area across the countryin December2012. How to make the informal finance develop more normatively andinduct private capital better serve to the real economy has become one of theimportant issues to answer. In this background, the paper will review and summarizepresent situation of private capital in Quanzhou, and then according to the proportionof credit financing and GDP, using the economic and financial related coefficientmethod in certain conditions to estimate its scale. Combined with the practicaloperation of private capital to analysis its main flowing and new flowing trends onthe basis of the measured scale, then the paper will discuss about the financial effectof private capital in Quanzhou through four aspects which are the financial structure,financial innovation, financial efficiency and financial risk.The paper found that:(1) the size of the private capital in Quanzhou overallshowed the trend of gradually expanding, and its scale has reached about390.6billion RMB in2012.(2) To serve the local small and medium-sized enterprises alsoindividual industrial and commercial households is still the main flow of Quanzhouprivate capital, but in recent years as the private capital investment channelsgradually broadened, the money flow has also shown some new trends, such asgradually flow into the financial industry, municipal projects, property rights tradingmarket, venture capital and private equity financing, etc.(3) The financial effect ofthe private capital shows both positive aspect and negative aspect. Due to the formalfinancial system of Quanzhou is not perfect, the development of the private capital in Quanzhou is helpful to the optimization of financial structure system and theinnovation of financial products, also good to completing the financial system andimproving the efficiency of market operation. However, due to the certainspontaneity and blindness of the private capital itself, it can also induce somefinancial risks which will affect the effective operation of the financial markets andsocial stability. In allusion to neither the current problems existing in the privatecapital or its potential financial risks, this paper put forward the correspondingpolicy recommendations through the regulation, money supply-demand relationshipand fund flow guidance, and the construction for market environment, to make theprivate capital serve the real economy better, thus let the economy of Quanzhoudevelop smoothly and healthily.