Study On The Development Strategy Of Shenyang Hunnan New District State-owned Assets Management Company

Since the2008US subprime crisis spread to the world,China’s State Councildecided to launch an economic stimulus policy of “Four Trillions Yuan”, whichintended to mitigate the impact of this crisis， to enforce the domestic demand, and tomaintain the economic stability. The LGPs (Local Government Platform) therebyrecognized a rapid growth during this period in a lot of China’s locals. Generally, theLGPs successfully resolved the financial difficulties for local governments pendantthe urbanization process，accelerated the development of related industries, andplayed a positive role for economic stimulus. However, as the number of LGPscontinues to expand, the government’s fiscal deficits, illegal operations of someplatforms and other issues began to highlight the risk.Since2010, China’s State Council and other related authorities have issued aseries of regulation policies to standardize the LGPs:“Suppress the governmentalfinancing function from LGPs, separation of public debt and cooperate debt, localgovernments may not raise debts through corporations, and corporate debts may notbe transferred to governments"; other policies dedicated to clear up the localgovernment debts, and finally to promote reforms and restructuration of LGPs. Basedon this background, this paper plans to engage a feasibility study and submit relevantproposals for Hunnan State-owned Assets Management Company’s (HunnanSOAMC) strategic transformation.Hunnan SOAMC, relying on the Hunnan construction project, is a district-levelLGP of Hunnan, as the unique delegation granted by district government, it’s responsible of land exploration, municipal infrastructure construction, projectexploration, capital management etc. As the unique city integrated operator ofHunnan new district, under the historic background of “Great exploration of Hunnandistrict and Twelfth National Athletic Games construction” and based ongovernmental credit, Hunnan SOAMC has acquired investing support from severalfinancial institutions and recognized a good development in recent years. But aspolicy constrains continue to be strict for LGPs, Hunnan SOAMC also confront somedevelopment difficulties temporarily.In this paper, the internal and external environment and the SWOT of thecompany will be analyzed, study on the direction of the strategic transformation, andfinally draft an overall plan for company’s financing reform and diversifiedoperations. I also proposed some strategic safeguard measures for the corporaterestructuration and the corporate cultural construction. Especially to proposecorporate management innovations, resources integration around the Hunnan NewDistrict; research on potential resources in the region; project financing throughPublic-Private-Partnership (PPP) to create corporate business sections; establishmentof non-banking financial institutions, to meet the financing needs of SMEs (Small andMedium Enterprises); to build business campus to attract installation ofentrepreneurial enterprises and SMEs; the establishment of venture capital funds,intend to support enterprises of the early and middle entrepreneurial developmentphase, to help them to look for investment opportunities, in ensuring the preservationand appreciation of state-owned capital. I wish this paper will be valuable for HunnanSOAMC transformation, and may constitute a reference to the future development ofother similar financing platforms.