Research on the Chinese Government's Debt and its Financial Risks

The basic structure of Chinese state-owned economy is the trinity of the state finance, the state-owned banks and the state-owned enterprises. The Chinese government debt includes the debt of central and local government, the debt of state-owned banks, the debt of state-owned enterprises, and the debt of other public administration sector, the financial risks is closely related to the government debt, and can be measured by those statistical indicators such as the ratio of finance's debt dependence, the paying ratio of state debt, the burdening ratio of state debt, the ratio of financial deficit to GDP. The composition of Chinese government debt is very different from western countries. In China, the debt of all public sectors, including the debt of central and local government, the debt of state finance, the debt of state-owned banks and enterprises, and the domestic and external debt, are interconnected; also there are a lot of hidden deficits and debt. So, it is not right to judge the situation of Chinese government debt simply based on internationally accepted standards. However, we must pay more attention to guarding against financial risks, and try to promote financial and economic sustainable development.