Debt Risk Assessment And Early Warning Of Prefecture-levelcities In Jiangxi Province

On the one hand,issuing local government debt can stimulate demand and release domestic demand,thereby promoting local economic and social development;On the other hand,it will also bring enormous debt repayment pressure to the local government,thereby bringing risks to the stability of the social economy.Although the Ministry of Finance proposed as early as 2021 that governments at all levels should pay attention to the issue of debt risk,and the central government has also increased its efforts to rectify it and introduced many measures,there are still many problems,such as imperfect regulatory systems,incomplete disclosure of information,deviation in political performance,and lack of management.Jiangxi Province,as a large central province,has an economic level in the middle reaches of the country,and its growth rate continues to be higher than that of the whole country.However,with the impact of economic transformation and upgrading,the impact of the epidemic,and measures such as tax and fee reductions,the economic development level of Jiangxi Province has also been affected to a certain extent.In order to better adapt to the new environmental changes,the Jiangxi Provincial Government has boosted economic development through massive borrowing and other means.Although the measures are effective,they inevitably bring hidden dangers to it.What is the current situation of municipal government debt in Jiangxi Province? Is debt risk controllable? Is there any difference in debt risk among prefecture-level cities? These are urgent issues to be addressed.Based on this,this thesis uses the entropy weight TOPSIS method,gray prediction method,and KMV model to study the economic development and debt problems of prefecture-level cities in Jiangxi Province,and carries out risk assessment and early warning for the debts of prefecture-level cities in Jiangxi Province,thereby providing reference suggestions and ideas for preventing debt risks in prefecture-level cities in Jiangxi Province.This thesis uses the relevant knowledge of statistics to conduct qualitative and quantitative analysis on the basis of sorting out relevant concepts and theories.Firstly,by analyzing the current economic development situation of cities at various levels in Jiangxi Province,it is found that there is a large gap in economic strength among cities at various levels,and the differentiation between regions is relatively obvious;On the debt issue,there are also corresponding debt risks between cities at various levels.Subsequently,based on the actual situation of Jiangxi Province’s debt in Chapter 3,four categories of primary and 13 categories of secondary debt related indicators were selected,and the weight between the indicators was determined using the entropy weight method.Then,the debt risk situation of various cities from 2019 to 2021 was comprehensively evaluated using the entropy weight TOPSIS method;Finally,the improved KMV model is used to early warning the debts of various cities in Jiangxi Province.Prior to the early warning,the relevant data of various prefecture-level cities in Jiangxi Province from 2022 to 2024 are predicted using a grey prediction model(GM(1,1)),and different debt ratios are calculated,and they are substituted into the KMV model to calculate the probability of debt risk occurring in various prefecture-level cities in Jiangxi Province.However,due to the complex reality,such as the government’s consideration of achieving political achievements,stimulating demand,and expanding investment,even if the debt matures,it may not necessarily repay the debt as scheduled,resulting in debt risk.Therefore,in order to control the government debt risk within a reasonable range,the municipal government of Jiangxi Province needs to take various measures,such as establishing and improving the prevention and resolution mechanism for local government debt risk,standardizing local government borrowing behavior,strengthening the construction of laws,regulations,and systems,or drawing on the experience of developed countries such as the United States and Japan to establish a debt service reserve system,in order to prevent the debt risk from developing irreversibly.