The Research On PPP Projects On The Pressure Of New Local Debt

At present,China’s debt ratio exceeds that of developed countries,especially local government debt.This not only shows the unsustainability of local financing but also exposes economic development to huge risks.In 2014,the central government issued a series of policies to encourage the introduction of public-private partnerships(PPP)in the field of infrastructure.This means that infrastructure projects financed by urban investment bonds can attract private investment through PPP models,with the aim of alleviating new local debt.However,the PPP push could also lead to an increase in local government debt.Due to the imperfect market environment and government governance capacity,private investment accounts for less than 30% of the total value of PPP projects in China.In addition,the landing rate of PPP projects is low.Once A PPP project fails,the government needs to subsidize investors and users.Even if PPP projects are implemented smoothly,about 80% of the return mechanism of PPP projects is government payment and feasibility gap subsidy,and the project income is ultimately borne by the government,which also adds a new debt burden to the government.In order to study this problem,this paper conducts two-way fixed-effect regression analysis on unbalanced panel data of bond issuance of 266 municipalities and prefecture-level cities in China from 2010 to 2017.The main conclusions of this paper are as follows :(1)PPP projects will significantly increase the issuance of urban investment bonds(a typical local government debt);(2)Land transfer income has a partial intermediary effect on the promotion of new URBAN investment bonds by PPP projects;(3)In addition,the higher the stock of debt,the more significant the positive effect of PPP projects on new urban investment bonds.The possible innovations of this paper are as follows :(1)From the perspective of the research content,this paper empirically analyzes the impact of PPP on local new debt by using samples at the city level in China,and explores its impact path;It also explains the relationship between PPP model and local new debt with social exchange theory,and discusses the exchange of resources,reciprocity principle and exchange results between government and social capital.(2)From the research conclusion,this paper breaks the ideal presupposition that PPP alleviates local financing pressure and alleviates local debt,and provides empirical evidence at the city level for PPP to accelerate the accumulation of local debt.In addition,this paper also demonstrates the interaction between different financing instruments of local governments and the phenomenon of "borrowing new to repay old".(3)From the perspective of policy suggestions,this paper provides inspiration for local government governance capacity,financial management,and debt financing.