Zhang Monan: Implicit Debt Liquidation Is The Key To The Disposal Of Stock Debt.

Recently, the solution to the problem of local government debt is very frequent. Following the August NPC Standing Committee's deliberation and adoption of the new budget law and the general plan of deepening the reform of fiscal and taxation system passed by the Central Political Bureau earlier, the "new regulation of local debt management", which was forced by local debt risk, was promulgated in 43.

The "bright spot" of "No. 43" is the central government's explicit "no bail" for local governments. It is not difficult to find out the way to deal with local debt and the new round of financial management system reform. The management of local debt still needs to be built on the basis of national credit. The central government's "no help" to local governments is still a big problem.

China has formed a hidden guarantee system with "central government as its core and local government as its main body".

The government's support for enterprises has changed from past direct support to guarantee or implicit commitment. These guarantees or commitments have not been included in the budget of the government, but it is a hidden extra budgetary expenditure or responsibility.

In recent years, local governments have secured various loans and debts through city investment companies, shadow banks and other channels, forming a large number of hidden debts and deficits. These implicit debts have not been included in the budget management system, and are still outside the scope of policy monitoring.

According to the wide caliber measurement, the scale of China's government debt is huge and its recessive characteristics are very obvious.

Data show that over the past 10 years, China's government's implicit debt and explicit debt have kept increasing at the same time.

By the end of 6 2012, the government debt of 82 trillion and 700 billion yuan, the explicit debt balance accounted for 10.2%, the implicit debt accounted for 89.8%, the implicit liabilities of the local government is becoming one of the medium and long-term risks faced by China.

A few days ago, the Research Report on fiscal pparency of China's municipal governments released by the center for public economics, finance and governance in Tsinghua University and the "289 cities' pparency list" in 2014 showed that only 14 cities published relevant data on the disclosure of government debt, and most of the government debt was borne by the municipal and county governments' investment and financing platform companies.

Due to conflicts of interests and institutional reasons, there are problems of low pparency, poor professionalism and administrative intervention in the use of implicit debt. There are different sizes of supervision and lack of statistical information.

Such problems can not carry out regular statistics, monitoring, evaluation and control of government debt, and it is difficult to fully grasp the real situation of government debt.

At present, there are no special institutions and standards to count local debts.

The financing platform of various areas is more and more diversified and hidden, and the source and quantity of many funds can not be known, and the scale of debt is also hard to be counted.

local government

It includes three main categories: first, the deficit gap of local state-owned enterprises.

In recent years, the reform of the state-owned assets management system has changed the relationship between the government and the state-owned enterprises. However, there are still problems in the reform of state-owned enterprises, such as the separation of government and business and the distinction between government and capital. The local government's intervention in the daily business activities of enterprises is increasing. The overall efficiency and financial status of state-owned enterprises directly affect the formation of government debt.

The two is the local government's policy debt.

Such as debts owed by local governments, debts raised by fund-raising, repurchase financing debts and trust financing debts.

The three is the local government's debts in social security funds and housing provident fund, the bad assets of local financial institutions and the debts formed by their disposal.

It is inevitable to keep the bottom line of supervision and guide the release of risk through marketization and break the rigid payment of local governments.

Although the central government is responsible for all the local governments in the system, on the economic level, the central government and the local governments are in the process of decentralization led by the central government. The central government endows the local governments with more autonomy in economic development. At present, the local governments have certain independent powers in matters of power, so the central government can not assume full responsibility for the debts of the local governments, so this has the rationality of the system.

The central government

In the case of breach of contract, we must cut off the chain of credit guarantee from the system and completely change the debt solution which is characterized by black box operation.

I believe that the premise of local government credit rating is to cut off the central government's assistance to local governments, so that local governments have independent solvency and credit basis.

A more mature debt supervision system requires pparency in debt.

The United States, Australia and other countries have established a more complete system of local government debt reporting. Local governments must disclose information on the scale of debt, lending, repayment and interest to the public.

Next, we need to improve the government's implicit debt accounting, statistical reports and audit supervision, establish a government debt scale control and risk early warning mechanism, conduct regular monitoring and evaluation, dynamically control the expansion of government debt and risk exposure, disclose government debt information, and further promote the marketization of debt to undertake liquidation and exit, and pay for rigid payment.