Research On Government Debt Problem And PPP Model In Yingkou Economic And Technological Development Zone

According to the statistics released by the auditing department at the June of end of 2013,the debts need to be paid by all levels of local government reached 20.7 trillion RMB,among which 10.9 trillion yuan shall be paid by local governments.For local governments,such tremendous debts mean bigger capital demands.The traditional development model of getting money through land transaction in local cities is no longer sustainable.Thus,the local governments should take a multiple and diverse capital-raising model to ensure development.Under such circumstances,the cooperation on public projects between local governments is worth promotion.Yingkou economic and technological development zone(abbreviated as ETDZ)used to solve the capital problems occurred in urbanization through"land finance".However,faced with the gloomy real estate market,the drop of land turnover leads to a decline of taxation.To address the capital problem during local development,the ETDZ government has to raise fund through financing.This has promptly enlarged local debts.These debts are mainly used in areas of infrastructure and livelihood improving,characterizing few profits or long terms of profit return.While at the same time,leading to a waste of resource as mass state assets poorly used.The government lacks money while entitled franchise right.On the contrary,social resources owns abundant capital but lacking franchise right.These differences created opportunities for cooperation between government and social capitals.The financing model of PPP(Public-Private-Partnership)just meet the need.The PPP model has already been popularized in public sectors in Europe and the U.S..Chinese government also starts to promote this model.Thus,the ETDZ government resort to PPP to finance and steadily address the debt problem.According to the study of the debt of the ETDZ,we found that although there is a big debt,there is also a fixed asset,and then resolving the fixed asset,and then resolving the government debt in line with the appropriate PPP mode of financing.ETDZ uses tourism and wastewater project revitalize the fixed assets of the area,therefore ETDZ is promoting personnel training and new PPP project actively to push forward the economy development.