Are you asking about the "Loan Balance of Local Financing Platforms"?

The so-called local financing platform refers to the establishment initiated by the local government. By allocating assets such as land, equity, fees, and treasury bonds, it quickly packages a company whose assets and cash flow can meet financing standards. When necessary This is supplemented by financial subsidies as repayment commitments to achieve the purpose of receiving funds from various sources, and then use the funds for municipal construction, public utilities and other projects of varying quality.

In layman’s terms, the government is responsible for raising money, land, and assets to establish a company, and then provides preferential policies, using fiscal revenue (mainly future taxes) as a guarantee, to banks, enterprises, or other social organizations. Groups and individuals borrow money for municipal projects and public utility construction.

This phenomenon is a way for local governments to raise funds in the short term to improve political performance under my country's performance evaluation system based on GDP. However, financing platform loans overdraw future fiscal revenue, which means that the government does not have that much money now and will use the money to repay the borrowed money after taxes are collected. In this way, local construction and economic development can indeed be promoted when the current officials are in power. However, due to the overdraft of future fiscal revenue, if the loan balance is too high, financial difficulties will inevitably occur in the future, and the loan cannot be repaid on time, resulting in bad debts of financial institutions, and There are some issues such as increasing the tax burden on local enterprises and people, so the central government has been counting and investigating this matter.