Study On The Problems And Countermeasures Of Local Government Debt In China

One of the important reasons for the development of the world economy and the stabilityof the threat is about government debt risk problem. The local government debt risk is themain behavior of our government debt risk. The risk of debt problem of local government inChina since2009has caused a wide range of social concerns. The number of China’s localgovernment debt at the end of2010is10.7trillion yuan. And at the end of20136, the localgovernment debt scale reached nearly17.9trillion yuan. Even some scholars put forward themain promoter caused the economic crisis in our country the next round will be the real estatebubble and the local debt problem. The local government because of the "budget law"constraint, so it is the demand of financing can not get through the issuance of debt waysatisfied. The local government in order to solve the financial revenue and expenditure haslimited the increasing problem, raise funds through various channels of financing, forming acontinuous expansion of the scale of local government debt, and a huge debt risk in theabsence of regulation and repay the deposit under the condition of the form. If not as soon aspossible to governance, China’s economy may cause serious consequences because of localgovernment debt risk.In order to solve the problem of local government debt risk and its countermeasures ofthe study, this paper firstly comprehensively analyzes the general condition and riskmechanism, at present our country local government existing debt formation. After manyyears of accumulated to form the existing debt scale of local government in China, especiallythe reform of the tax system after94years later, with the expenditure of local governmentresponsibility of uninterrupted growth, our local government debt also appeared relatively fastgrowth, the debt of local governments in China to cope with the international financial crisisand two the emergence of large-scale growth. Risk of Chinese local government debt throughthe analysis from the perspective of debt structure, scale and management, found thatalthough the overall controlled, but certain risks still exist. Risk of Chinese local governmentdebt to analysis the main reasons of the formation from fiscal decentralization theory point of view, is because the local government’s income is not enough to complete its expenditure. Therelations between the governments lack of legal protection, the contradictory between thefinancial system and the government system. With the theory of public choice directionanalysis, government as a "broker" debt will be ignored and the allocation of rights andinterests contradiction the existence of different levels of government debt, and the lack ofefficient decision-making mechanism constraint is the forming reasons of the debt risk. Basedon principal-agent theory, the cause of the local government debt risk produces is the problemof principal-agent relationship in local government and the public, the central government andfinancial institutions and other creditors in.The first part is the recommend, recommend the research background and importance,analyze and summarize the research results at home and abroad, puts forward the researchcontents and methods. The second part is the analysis of local government debt risk theory.The introduction of the related concept of local government debt risk, and from the early inthe development of the modern to the analysis of the western theory of government debt risk.The third part is the analysis of the present situation of local government debt risk in china.Introduces the basic situation of local government debt in China, from the macro analysis ofthe scale and structure. And discuss the existence of local government debt in China,performance and harm of place and analysis of local government debt risk in china. Thefourth part is the analyses of the reasons of local government debt risk in China, analyzing thecauses analysis of local government debt risk in China from the financial system andeconomic system, administrative management system, local government debt managementsystem these four aspects. The fifth part is the countermeasures to prevent the risk of localgovernment debt, the problems and causes based on the targeted countermeasures were putforward.