For the European debt crisis, what countermeasures should be taken in China (University SiLe class final paper)

First, expand the financing channels of the central government and local governments, to realize the matching of government revenues and expenditures, and not to overestimate the affordability of foreign debt and local government liabilities. The essential reason for the European debt crisis is that the government's debt burden exceeds its own affordability, and the risk of default. China should as soon as possible in the form of legislation to strengthen the local government budget management, enhance transparency, reasonable control of the scale of government debt, strengthen risk management, but also in a timely manner on the overall financial and debt situation of the country to make a comprehensive inventory and assessment of the size of the local government debt limit management and risk early warning, and effectively prevent the risk of default on debt servicing in the financial and monetary aspects.

Second, expanding domestic demand, transforming the economic growth model, improving the international competitiveness of the country's industries, and enhancing the endogenous growth capacity of the economy cannot be completely government-led investment-driven economic development model. In the troika of pulling the economy, investment has been the killer mace of our government to promote economic development, especially after the outbreak of the current round of global financial crisis, imports and exports have been doubly hit, and the consumer market has been sluggish, to increase investment in fixed assets has been tried and tested. Our country also from the fiscal surplus in 2007 to the fiscal deficit in the past two years. Therefore, how to reduce the dependence of economic development on investment and export, that is, reduce the contribution of capital formation and net exports to economic growth, and increase the contribution of final consumption to economic growth, is the key to the transformation of China's economy, the future of the infrastructure investment should be moderately compressed, and improve the income of the residents, increase the propensity of residents to consume should become the focus of the work of the domestic economy.

Third, allowing private funds to enter the infrastructure investment sector will also improve the overall efficiency of the industry. In addition, China could further allow private investment into long-monopolized sectors such as education, healthcare and railroads, which are also conducive to the transformation that will drive the development of the service sector. The introduction of these reform measures also means that China's economy can avoid a serious slowdown.