Construction Financing Problem of Local Government in China

Infrastructure construction is a necessary precondition to rapid and continues growth for local economy. Many cities have conspicuous contradiction of expansion of investment and lack of capital or unsmooth financial channel. Lack of capital effects the quantity and quality of public product which provided by local government, and causes social welfare loss. How to utilize and integrate present resources is studied in this paper. Foreign regulation is referenced to explore new financing channel in China. Some countermeasures and suggestions are put forward to solve present financing problems of local government.