Research On Financing In Support Of Private Sector In Liaoning Province

As China enters into a new era of high-quality development with socialist characteristics,its private sector is witnessing robust growth.Both the report of the 19 th National People's Congress and the central government work report call for greater efforts to vigorously support the further development of the private economy and offer more inputs in helping private companies tackle the problems of insufficient financing which is hindering the growth of the private economy in China.The private sector of the Liaoning Province has been playing an important role in its provincial economy.During his inspecting visit to Liaoning Zhongwang Group,a private company based in the region,at the end of September 2018.General Secretary Xi Jinping said that the government has been trying to unswervingly encourage,support,guide and protect the development of the private economy.However,private sector of Liaoning Province is still lacking behind that of those developed provinces in the Eastern part of China in terms of economic performances.In order to solve the problem of inadequate financing in the private sector,the Liaoning Provincial Government has been working together with financial institutions and other related companies in establishing various financing vehicles and financing service platforms and launching special funding programs for the private sector.But how does it work? It is generally believed that it is important to know what constraint applies when solving a problem so that the attempt to push against that constraint to find a unique solution would prevail.So a closer look at the current situation of and the existing problems hindering the development of the private sector is absolutely necessary before policy recommendations for financing in support of the local private sector could be put forward.This paper studies on the subject of financing in support of the development of private sector in Liaoning Province.In the first part of the paper,a literature review is made and we find that both domestic and foreign scholars agree that direct and indirect financing,government policies and government financial support all play an importantpart in boosting the economic performances of the private sector,but they seem to have failed to have a consensus regarding what is the most influencing factor.Therefore the paper,based on the theory of financing,financial development and economic growth theorem,examines the interaction between financial support and private economic development,and establishes the theoretical basis for the other part of the paper.The second part,by using the factor analysis method,extracts the influencing factors of financial support,and calculates the comprehensive level formula of financial support using the calculation of the data taken from Liaoning cities,so that a better understanding of the gap of financial support level between Liaoning province and other provinces could be obtained.Eviews is used to analyze the relationship between the level of financial support and the development of private economy,finding financial support defects that currently exist in the development of private economy in Liaoning Province and some leads on how to improve.Finally,this paper provides constructive suggestions for improving the development level of Liaoning's financial support for private economy from the perspectives of direct,indirect and government financial support systems respectfully.