This article is included in the recently published "Proposal of the Central Committee on Formulating the Fourteenth Five-year Plan for National Economic and Social Development and the Long-term Goal in 2035". In this paper, Liu Kun elaborated a perfect, standardized, safe and efficient government debt financing mechanism.
Regarding the prevention and resolution of hidden debt risks, Liu Kun said that in order to improve the normalization monitoring mechanism, it is absolutely not allowed to launch new projects and spread new stalls by adding hidden debts. Harden budget constraints, comprehensively strengthen project financial affordability demonstration and budget review, and all financial expenditures are included in budget management according to law. Strengthen the supervision of state-owned enterprises and institutions, improve the allocation mechanism of local governments and their departments to enterprises and institutions according to law, and prohibit local governments from increasing implicit debts in the form of corporate bonds.
At present, the growth momentum of implicit debt of local governments has been curbed. Judging from the solution announced by the local government, it is mainly through "coordinating funds and repaying a batch; Bond swap, a batch of extension; Project operation, digest a batch; Introduce capital and convert a batch to resolve it.
Liu Kun pointed out that development and policy-oriented financial institutions must operate prudently and in compliance with regulations, comprehensively consider the cash flow and collateral of the project, and prudently grant credit. It is strictly forbidden to provide financing to local governments in violation of regulations or cooperate with local governments to borrow money in disguise.
Development financial institutions refer to CDB, and policy financial institutions refer to Agricultural Development Bank and Export-Import Bank. In recent years, CDB and Agricultural Development Bank have extensively participated in government credit business. Because some businesses are bound by government credit, they are suspected of adding implicit debt. Under the new situation, the traditional government business is also facing the problem of transformation, such as shed reform loans, special construction funds and so on.
The main mode of shed reform loan is that the main body of shed reform pledges the government purchase service contract to the bank for financing. According to the contract, the government pays the purchase funds to the enterprise in stages to repay the bank loan. From the perspective of penetration, it is essentially a financial reform of shed-to-shed loan, which is suspected of adding implicit debt.
The operation mode of the special construction fund is that CDB and Agricultural Development Bank issue special construction bonds to the Postal Savings Bank, and then use the funds raised by the special construction bonds to establish a special construction fund, and CDB or IFAD will invest in the project company in the form of equity.
In the case of large-scale start-up, the fund invested in some private enterprise projects. However, due to risk considerations, CDB and IFAD require local financing platforms to buy back the equity of private enterprise projects held by the fund as agreed, and private enterprises will buy back the equity from local financing platforms. In recent years, some special construction funds have also been identified as hidden debts.
On the morning of October 30th, 65438/KLOC-0, China Development Bank held a bank-wide general party membership meeting to convey the spirit of studying the Fifth Plenary Session of the 19th CPC Central Committee. The meeting said that it is necessary to focus on the main business and play the role of strategic tools and policy tools; Reform the internal system and mechanism and improve the governance system; Promote the innovation of financing methods, help the market-oriented reform of investment and financing systems in key areas, give better play to the role of development finance as a bridge between the government and the market, and contribute to promoting effective markets and better integration of the government.
165438+1On October 26th, Zhou Qingyu, vice president of CDB, introduced at the 264th regular press conference of the banking and insurance industry that during the Tenth Five-Year Plan period, CDB will invest 2 trillion yuan for the renovation of old urban communities, and will make financing plans for the Tenth Five-Year Plan together with other provinces. For the problem that local governments may face financial constraints, CDB will solve it from three aspects:
First, we must adhere to relying closely on local governments. As long as local governments have enthusiasm and initiative, CDB will actively cooperate and serve local governments. The government should formulate relevant policies and then integrate government-owned resources, such as land, idle factories and communities.
The second is to play the role of local state-owned enterprises. It is necessary to integrate the platforms of local state-owned enterprises at the provincial, prefectural and county levels and use them to undertake this task. On this basis, CDB provides financing support, adheres to the principle of capital preservation and low profit, and implements preferential interest rates to reduce the financial cost of the transformation of old residential areas.
Third, actively promote the introduction of social capital to ensure a reasonable return on social capital.
The market is also concerned about how to innovate CDB's old financing model. Liu Kun also said that it is necessary to clean up and standardize local financing platform companies and divest their government financing functions. Improve the market-oriented and rule-based debt default disposal mechanism, and resolutely prevent the accumulation of risks from forming systematic risks. Strengthen the accountability of supervision and auditing, and strictly implement the lifelong accountability system for government borrowing and the debt problem investigation mechanism.
Liu Kun also said that the scale of government debt should be reasonably determined according to the needs of counter-cyclical adjustment of fiscal policy and the requirements of fiscal sustainability. Construct a local government debt financing mechanism with standardized management, clear responsibilities, openness and transparency, and controllable risks according to law.
Local bonds were first issued by the central government in 2009. In the government work report of that year, the State Council agreed to issue 200 billion yuan of local debt, which was issued by the Ministry of Finance and included in the provincial budget management. 20 10 to 20 14, and the issuance scale is between 200 billion and 400 billion, all of which are issued by the Ministry of Finance.
After the implementation of the new budget law of 20 15, provincial local governments began to independently issue local government bonds for borrowing, and the scale of local debt issuance began to increase substantially. After 12 years of expansion, local debt has become the second largest variety in the bond market. Wind data shows that as of165438+1October 30, the balance of local debt reached 25.3 trillion, second only to financial debt, and the debt ratio of local governments was close to the red line.
At a seminar held in July this year, Wang Kebing, a first-class inspector of the Budget Department of the Ministry of Finance, bluntly said that with the rapid expansion of the issuance scale of local government bonds, especially special bonds, the balance of local government debt has increased rapidly, and by the end of this year, the local government debt ratio is likely to enter the internationally accepted early warning range 100%- 120%, and the risk of government debt has gradually increased.
Liu Kun proposed to improve the local government debt limit determination mechanism, so that the general debt limit can match the general public budget revenue such as taxes, and the special debt limit can match the budget revenue and project revenue of government funds. Improve the debt risk assessment index system of local governments based on the debt ratio, and improve the assessment mechanism of local governments' solvency. Strengthen the application of risk assessment and early warning results, and effectively promote the risk prevention and control barrier.
Due to the steady recovery of the macro-economy, the debt ratio of local debt is approaching the warning line, and local debt funds are idle. The market expects that the scale of new special bonds will fall next year.
Regarding national debt, Liu Kun said that it is necessary to optimize the variety structure and term structure of national debt and local debt. Continue to promote the healthy development and opening up of the national debt market, improve the yield curve of national debt reflecting the relationship between market supply and demand in time, and give full play to the role of national debt interest rate as the market pricing benchmark. Improve the government debt information disclosure mechanism and promote the formation of a market-oriented and rule-based financing self-discipline and restraint mechanism.
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This year, local debt issuance can reach 6.5 trillion yuan, and the local debt rate is approaching the red line due to the epidemic.
Editor Li Jianhua Intern Li Geli
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