A Research On The Financial Risk Of Local Government Debt Of Wuhan

Expanding the scale of local government debt as a form of active fiscal policy,for many years,local governments at all levels have borrowed a lot of money for urban infrastructure construction to promote local economic development.However,with the continuous development of China’s economy and society,the risks brought about by the gradual increase in the scale of local government debt have aroused great attention from the central government and local governments at all levels.The report of the Nineteenth National Congress proposes to resolutely fight the battle to prevent and resolve major risks,and the prevention and resolution of local government debt risks is an important part of it.Wuhan,as an important city in the rise of the central region,has maintained rapid economic growth since 2008,the economic growth rate slowed down in 2018,and in 2020,it suffered from the impact of the new crown epidemic on the economy,at the same time,the urban construction of Wuhan is in a critical period,making the scale of local government debt continue to grow,which exposes some problems in government debt management,risk prevention and control.In order to study the risk of local government debt in Wuhan,this paper sorts out the economic development status,fiscal revenue and expenditure,debt borrowing situation,etc.of Wuhan,calculates the debt risk of Wuhan city in combination with the formula,analyzes the existing problems and causes,and puts forward corresponding opinions.This paper mainly adopts the literature research method,data analysis method,case research method,etc.,through reading a large number of relevant literature and finding the data disclosed by the Wuhan Municipal Bureau of Statistics,the Finance Bureau,relevant journals,etc.,combined with the theory of public goods,the theory of fiscal decentralization,the theory of entrustment and agency,and the theory of risk management to analyze the debt of Wuhan local government,study the risk management of Wuhan local government debt,analyze its existing problems,and put forward corresponding suggestions.Through the research,this paper finds that there are problems in the management of government debt in Wuhan,with slowing economic growth,reducing the general public budget,and growing the scale of local government debt.The reasons for these problems are mainly due to factors of the fiscal system,the reform of the tax-sharing system has led to a mismatch between the central and local fiscal and administrative powers,and local governments have the need to borrow and finance;Administrative system reasons,mainly the promotion mechanism of officials;There are not enough constraints in all aspects.In the analysis of the debt risk of Wuhan local government,this paper mainly divides the risk into repayment risk,scale risk,structural risk,and economic risk,sets the corresponding indicators and formulas,combines the economic data and debt data of Wuhan city,and calculates that the debt risk of Wuhan is relatively high,and it is necessary to resolutely control and prevent government debt risks,and can be prevented from improving institutional mechanisms,transforming government functions,and actively resolving existing debts.