Research On The Application Of Infrastructure Funds In Local Government Financing

For a long time,local governments have relied heavily on local financing platforms to raise funds for local infrastructure projects,which has greatly promoted local economic development.In this process,the financing platform has used a number of financial instruments for financing.The “infrastructure fund” has been widely used in recent years due to its own characteristics.It has met the financing needs of local governments on the one hand.At the same time,however,it has also contributed to the phenomenon of “chaotic debts” by local governments,which has also increased the debt risk of local governments.The introduction of new regulatory documents such as the 50 th and 87 th documents of the Ministry of Finance in 2017,the document forbids local governments from illegally borrowing money,and prohibits the financing platform from promising to repurchase the priority share of the infrastructure fund at maturity and give fixed income.The model of financing for facility funds has been negated by the supervisory authorities.Although under the current policy environment,it still has a relatively wide range of applications in the PPP areas where local governments rely most on infrastructure construction,and bears the important responsibility of building financing structures.However,with the constant adjustment and tightening of regulatory policies,"infrastructure funds" also encountered thorny problems in the use of PPP projects.Nationwide,there have been phenomena of slow progress or even difficulty in landing PPP projects.The earth has affected the local infrastructure and economic development.This article will rely on a project that the author actually participates in,and use the case study method to study the use of "infrastructure funds" in local government financing,especially in PPP projects.This paper concludes that the difficulty of raising the capital of the project company in the PPP project and the lack of willingness of the participating entities to perform the consolidation of the project company are the major reasons for the difficulties in landing the PPP project.The two issues are analyzed in more detail and the two are proposed for both.The PPP special support fund was established to strengthen the targeted opinions of the strength of state-owned enterprises as construction units.Based on this,based on the current status of the nationwide PPP industry,the government is advised to focus on the top-level design and establish a sound PPP project legal system;Financial institutions should also explore ways to better help advance the landing of PPP projects with a more positive attitude.