Wu Weixing: The duration of w88 casino games login debt exceeding one government term is worrying
(Source: "China Economic Herald" Date:2016-01-12 ）
20158341_83533.8Trillion yuan, surpassing treasury bonds and becoming the third largest bond type after interbank certificates of deposit and financial bonds. Many parties expect,2016w88 casino games login governments will increase the scale of debt replacement, and as the fiscal deficit expands, the scale of new w88 casino games login government bonds will also increase.
However, "China's National Balance Sheet2015》Show, in the previous158825_88662000Year~20148926_89403.9Trillion yuan, average annual growth in w88 casino games login government debt1.9Trillion yuan. Finance Minister Lou Jiwei recently published a signed article in "Qiushi" magazine and pointed out that my country's high leverage ratio is not conducive to the stable development of enterprises, the promotion of technological innovation, and the move towards the mid-to-high end of the global industrial chain and value chain. Although government debt accounts forGDPThe proportion is less than40%, but some areas are under great debt repayment pressure and there are w88 casino games login risks.
The "Thirteenth Five-Year Plan" recommendations propose on the one hand to increase the proportion of direct financing and reduce the leverage ratio; on the other hand, they also propose to establish a standardized w88 casino games login government debt financing system. So, during the “Thirteenth Five-Year Plan” period, especially at the beginning20169535_9593Professor Wu Weixing, Dean of the w88 casino of Finance, w88 casino。
w88 casino games login government debt financing: new challenges under the new normal
China Economic Herald: Hello. As China's economy moves towards a new normal, what new tasks and problems does the development of the w88 casino games login debt market face?
Wu Weixing:The first challenge is to control the scale of w88 casino games login debt. Due to various considerations such as w88 casino games login economic development and political performance, w88 casino games login governments may tend to expand the scale of debt for short-term economic goals, hoping that economic development will absorb debt and promote economic development. This approach is understandable, but the restraint mechanism is very important, otherwise it will lead to excessive investment in projects, further leading to overcapacity, and preventing the market from truly playing a decisive role in the resource allocation process.
The second challenge is the selection of construction projects financed by w88 casino games login debt. The boundaries between w88 casino games login governments and the market are difficult to clarify through rules and regulations. The government's information advantage once played an important role in the process of our country's economy catching up with developed economies. w88 casino games login governments can use their huge influence to quickly promote the development of w88 casino games login economies. This experience has also been recognized. However, as the economy further develops, the information advantage of w88 casino games login governments will inevitably be weakened. At this time, if w88 casino games login governments are overly involved in w88 casino games login economic construction, it will weaken the enthusiasm of other participants in the economic system, which may hinder the transformation and upgrading of our country's economy.
The third challenge is the market-based evaluation of w88 casino games login government credit quality. For an enterprise, its credit quality is easy to judge and its debt-raising ability is easily recognized by the market, so its investment and financing behavior can be well constrained by the market. But w88 casino games login governments are different. Their economic behavior is difficult to completely isolate from the central government. Therefore, they are often considered to have national credit and can finance at very low interest rates, allowing some projects that should be excluded by the market to be implemented, which may distort the market's ability to allocate resources.
More standardized management of w88 casino games login government debt
China Economic Herald: What are the advantages of using credit asset securitization to solve w88 casino games login debt problems? In what aspects is feasibility reflected? What problems might we face in actual implementation?
Wu Weixing:Replacing w88 casino games login government debt is actually equivalent to a kind of credit asset securitization. Debt replacement makes huge w88 casino games login government debt liquid. In a sense, this is also the conversion and appreciation of asset forms.
Using credit asset securitization to solve w88 casino games login debt problems is one of the best solutions. This method has many advantages. In addition to making w88 casino games login debt liquid and benefiting both investors and financing parties, credit asset securitization can also expose information related to w88 casino games login government financing and enable the government's financial behavior to be supervised by the market. In addition, credit asset securitization can also help w88 casino games login governments conduct cost-benefit calculations when borrowing in the future, and form a market reference for future investment decisions.
However, in the actual implementation process, the most important requirement is that w88 casino games login governments must respect the market and cannot use administrative power to interfere in the pricing, issuance and sales process of credit asset securitization and distort the market.
China Economic Herald: At present, w88 casino games login government debt replacement is mainly to solve the existing debt problem, but what about the new w88 casino games login debt in the future? The “Thirteenth Five-Year Plan” recommendations propose that a standardized w88 casino games login government debt financing system should be established. How do you think the central government should deploy and improve the w88 casino games login investment and financing system?
Wu Weixing: First, give w88 casino games login governments the borrowing authority that matches their powers. Manage w88 casino games login government debt in a more standardized and concise procedure, and separate it from the investment and financing activities of other market entities, so as not to compete with the people for profit, and adopt a government borrowing method that is open, transparent, and easy for market supervision; secondly, the general debt of w88 casino games login government shall be included in the general public budget management and shall not exceed the approval authority; thirdly, the destination of w88 casino games login bond financing shall be controlled and can only be used for public welfare capital expenditures and existing debt that social capital is unwilling to participate in Fourth, clarify the repayment subjects of w88 casino games login debts, clarify the responsibility relationship with the central government, and promptly assess the risks of w88 casino games login debts. The risk status must be linked to future debt quotas and government performance evaluations; fifth, even for public welfare capital expenditures, try to make use of government and social capital cooperation and other methods to maximize the role of the market in project selection and operation, and at the same time make government expenditures subject to full public supervision.
w88 casino games login bond issuance must achieve real risk pricing
China Economic Herald: The “13th Five-Year Plan” proposes to actively cultivate an open, transparent and healthy capital market. So specifically speaking of the w88 casino games login government bond market, what are the outstanding problems it faces in its development?
Wu Weixing:w88 casino games login debt is an important means for w88 casino games login governments to achieve their economic development goals. During the period of rapid economic development in China, w88 casino games login debt plays an important role in alleviating the funding gap of w88 casino games login governments, regulating w88 casino games login economic operations, and optimizing resource allocation. However, it would be overly optimistic if we thought that w88 casino games login finance and economic development would achieve a long-term and healthy positive cycle by relying on the self-repayment mechanism.
The first issue to pay attention to is whether the issuance of w88 casino games login government bonds can achieve real risk pricing. If market-based pricing cannot be truly achieved, the goal of financial market reforms to make w88 casino games login government bonds self-repayable will become a mere formality. If the central government still provides implicit guarantees, it may lead to a lack of restraint on w88 casino games login governments in the future, creating moral hazard in the long-term game that is difficult to control. If the w88 casino games login government's default resolution plan cannot be clearly clarified, the credit or default risk of the w88 casino games login government will not be reflected in the price of w88 casino games login debt, resulting in the failure of the market-oriented mechanism, and the spontaneous repayment of w88 casino games login debt will lose its meaning. Usually third-party rating agencies should play a corresponding role in risk pricing, but if the rating agency is designated by the w88 casino games login government, the principal-agent issue here also deserves attention.
Currently, a very worrying issue is that the duration of many w88 casino games login debts exceeds the term of one government. At this time, how to ensure that the government effectively uses w88 casino games login debts to achieve w88 casino games login long-term sustainable development goals is an important challenge. Driven by some government leaders who pursue short-term political achievements, the relative lack of power checks and balances and the imperfect market pricing mechanism can easily lead to the excessive expansion of w88 casino games login government debt, thus forming a funding black hole. Under this consideration, an effective restraint mechanism for w88 casino games login governments needs to be established during the reform process. Of course, detailed performance evaluation afterwards is also crucial.
Whether w88 casino games login governments can achieve full openness and transparency in w88 casino games login finances under the pressure of reforming the w88 casino games login bond issuance system is a particularly noteworthy issue. Only when information related to w88 casino games login finance, other liabilities, and future cash flows are fully disclosed to accept market testing and evaluation can the market truly play a role in the issuance of w88 casino games login bonds. If w88 casino games login finance is unclear or not transparent enough, making it difficult to be subject to market supervision, then the effect of the market-oriented reform of the spontaneous self-payment mechanism will be difficult to show, and it may even lead to a big hole in w88 casino games login finance and social instability. Only when w88 casino games login government balance sheets are clear and transparent can the repayment mechanism of w88 casino games login debt be made clear and recognized by the market.
China Economic Herald reporter Lu Yujiang
Attachment: Original report link
http://www.ceh.com.cn/epaper/uniflows/html/2016/01/12/B02/B02_79.htm
