Research On The Pros And Cons Of Commercial Banks Participating In PPP Project

Today,China’s comprehensive economy presents a new phase.The increasingly powerful social capital plays an increasingly important role in the construction of infrastructure,and the local government infrastructure has been widely adopted PPP model,which has caused a great pressure of competition to commercial banks in the field of public goods,so commercial banks no longer easily carry out the business and get a lot of return as they used to do.This paper discusses how to participate in PPP project and how to discern benefits and risks of PPP project for banks.In order to stabilize and give full play to the constructive role of bank credit in the way of infrastructure and public projects,the study of participation of bank credit in the PPP financing model has a greatly practical value.Taking Chengdu subway line 18 as an example,after the analysis of the necessity and feasibility of the project’s application of the PPP model,I analyze the parties involved in the project in detail.Finally I summed up the way,income and risk sources of commercial banks’ participation in the PPP project.This paper first reviewed the relevant research and theory,and then the current situation of PPP mode and the common mode are summarized.Thereafter,based on Chengdu metro line 18 to analyze the necessity and feasibility in implementing the PPP model in this project,the opportunity and way of participating in the mode,as well as the benefits and risks of commercial banks for participating in the mode,.In addition,I put forward some suggestions on the 18 line PPP project to the commercial bank,the social capital of Party and the Chengdu municipal government.Finally I draw the conclusion of this article.I hope the article can provide some guidance for banks to participate in PPP financing,and also provide the reference for the practical work in terms of Chengdu metro line 18 as well as other infrastructural construction.