Research On Financial Risk Management Of ZK Project Under PPP Mode

In the recent years,with the rapid economic development in our country,the demand for infrastructure construction is also increasing.Faced with the huge demand for infrastructure construction,it is difficult to solve only by relying on government funds.In order to decrease the pressure on government funds,our government has attracted a large number of social capital to participate in infrastructure construction through PPP.Therefore,the government has launched a large number of policies to support the promotion of PPP Since 2013,and private enterprises have gradually participated in PPP projects.However,with the large number of PPP project practices,the issue of social capital participating in PPP projects has become increasingly prominent,especially the financial risks faced by social capital are more obviously.As a leading enterprise in Zhejiang PPP industry,H company has always been at the forefront of China's PPP industry development.According to the annual report of H company,as of the end of 2017,the company has won a total of 32 projects in all provinces across the country with a total investment of over 42 billion.Among them,six PPP projects were selected as demonstration projects in the Ministry of Finance,and several projects have entered the implementation stage.Therefore,taking the H company's PPP project as the research object,analyzing the financial risk management of the private capital PPP project has certain reference significance.This article uses the case study method on the basis of relevant literature research.First of all,starting from the basic concept of PPP model,it introduces the types of financial risks of PPP projects,the related theories of financial risk management and the related theories of social capital-based financial risk management under the PPP model.Then,the basic situation of the ZK project and the current status of the H company participating in the ZK project were introduced.On this basis,the company's ZK project financial risks were identified,analyzed and evaluated.Finally,response measures and recommendations are given for H company's participation in the financial risks of the ZK project.After analysis,the financial risks of H company in the ZK project is specifically represented by financing risk,investment risk,capital recovery risk,cost control risk and tax risk.Therefore,according to the financial risks,we should respond from the following aspects: First,with regard to financing risks,through financial instruments and innovative financing methods,resolve the company's risk of paying back on time during the operation period.Second,for the risk of fund recovery,actively sign supplementary agreements to reduce the government's payment risk;Thirdly,aiming at cost control risks,we can establish strategic cooperation relationship with suppliers to reduce the impact of price increase on project profits;and fourthly,with regard to investment risks,optimize engineering service contracts and shift investment risks caused by inaccurate project budgets.Fifth,for tax risks,apply for subsidies from the government to reduce the risks caused by major changes in tax policies.Strengthen the supervision of management personnel and self-monitoring of management personnel,improve risk awareness,thereby further reducing H company's investment risk,cost control risk and tax risk.