Research On Total Risk Management Of Local Government Financing Platform

In the early 1990 s,when the national economy entered a period of vigorous development,and urbanization and industrialization were gradually taking shape,in order to meet the requirements of local urbanization and industrialization,local governments urgently needed to transform and upgrade backward urban infrastructure.As a result,this has led to local governments facing serious underfunding in infrastructure construction.For solving this problem,local governments use financing platform companies to obtain funds through credit and debt issuance.In this special economic context,a government financing platform was born.The government financing platform has made up for the huge funding gap,and it has played an important role in economic development and urbanization.However,due to the imperfect policies of the government financing platform and the non-standard management system,it has caused a lot of problems,and finally the platform risks have become increasingly prominent,which has led to the impact of social economic development and public finance security.Accordingly,it is necessary to conduct in-depth research on the problems arising from the financing platform,prevent and resolve the risks,and find a way to transform and develop.Further standardize the development of government financing platforms and promote the healthy development of the social economy.This study analyzes the background and development history of the government financing platform in China,and analyzes the research status in this field at home and abroad.It elaborates on the basic concepts,characteristics and development prospects of the government financing platform.It highlights the difference between the government’s main body of government financing platform and other enterprises,and further analyzes the possible potential risk identification and response strategies of the platform under the conditions of poor management,single channel,high financing cost and excessive debt.In the specific description process,the study analyzes and compares the domestic and foreign government financing behaviors in detail,sorts out the commonalities and differences,and takes the actual state-owned enterprises as a case,combined with the actual situation in China,to explore a more appropriate government financing platform.Then,it analyzes the current development status of local government financing platforms and the main problems in China,mainly from the three aspects of financial channels,government supervision and platform company’s powers.The local government financing platform is currently facing problems and the scale of development is too fast.Reasons for analysis,analysis of its economic entity,management system,business scope and financial status,the platform company’s rapid expansion,high debt ratio,etc.are due to the mismatch of finance,affairs,power,government participation in corporate behavior,rules and regulations Perfect,economic policy is not standardized,and the profitability of financing institutions is too strong....Finally,this paper uses the empirical analysis method to study the business scope,operation status and management system of the state-owned financing platform enterprise BH Investment Development Company,and deeply analyzes the financial data and overall operation status of the company in recent years.It was also assessed for risk.The study found that China’s local government financing platform is facing greater risks.The main reason is that the scale of local government debt is increasing rapidly and the quality is not good.The loan risks currently faced by the platform may not only affect the financial system,but also generate financial risks,and may also lead to government fiscal risks.Based on the actual situation of the case company,this study conducts a series of research and analysis on the government,financing platform and financial institutions,and discusses the risks of the financing platform.At the same time,combined with risk identification,risk management and related problem solutions,it puts forward corresponding suggestions on how to reduce the loan risk of local government financing platform and improve the risk management level.It mainly includes: strengthening effective supervision of platform operation and standardizing financing platform.The operation of the platform;strictly control the financing scale,capital flow,repayment and payment of the platform,so that the financing platform can be better developed,and establish a long-term governance mechanism for local government financing platform to further reduce local government A series of measures and suggestions for the financing platform,and to improve and improve the risk management of local government financing platforms,so that the financing platform can be developed more well,and ultimately contribute to the social and economic development and urbanization process.