At the end of 2023, a large number of major policy documents will be issued intensively. On November 8, 2023, the National Development and Reform Commission and the Ministry of Finance issued Document No. 115 "Guiding Opinions on Standardizing the Implementation of the New Mechanism for Social-Capital Partnership". On December 27, 2023, the General Office of the Ministry of Ecology and Environment, the General Office of the National Development and Reform Commission, the General Office of the People's Bank of China, and the General Office of the State Administration of Financial Supervision and Administration issued the "Implementation Guidelines for Eco-Environment-Oriented Development (EOD) Projects (Trial)" (hereinafter referred to as the "Implementation Guidelines"), both of which emphasize that no new local ** hidden debts shall be added, social capital is encouraged to actively participate in project implementation, and ** funds are restricted or prohibited from supporting projects. This article analyzes the relationship between funding and EOD projects through the analysis of the new regulations of the "Implementation Guidelines" for EOD projects.
Some people will say, what is the relationship between *** funding and EOD projects? Do you still use **? The new regulations of the "Implementation Guidelines" have clearly stipulated that EOD projects shall not contain ** capital investment. So is this the case? Yes, that's exactly what the original text of the provision says. But can't there be any ** funds in the EOD project? This is the question of this article, let's first take a look at what the original text of the "Implementation Guidelines" says.
1. The relevant provisions of the "Implementation Guidelines" on ** funds
There are three provisions in the Implementation Guidelines that involve ** funds.
1.Article 12 of the Implementation Guidelines stipulates that "carry out an analysis of the balance of project funds, clarify the project construction content and operation plan, estimate the project investment, operating expenses, operating income, etc., analyze the cash inflow and outflow of the project, and evaluate the financial profitability, debt repayment ability and financial sustainability ability of the project." Optimize and adjust the project boundaries and content based on the analysis resultsEnsure that the self-balancing of project funds can be achieved without relying on ** capital investment.
This clause emphasizes that the self-balancing of EOD project funds can be achieved without relying on ** capital investment.
2.In the guidelines for the preparation of the Implementation Guidelines, it is stipulated in the section on fund raising that "the method and composition of funds**, the method and proportion of project capital raising, and the channels of project financing** shall be clarified." Relevant requirements:It shall not contain ** capital investment, including ** financial funds, local financial funds, etc. The content implemented with ** funds is not included in the scope of the project to ensure that the project is an investment project for the enterprise. It shall not contain any form of medium and long-term expenditure responsibilities and financing guarantees that increase the risk of local hidden debts. ”
The meaning of this clause is that the total investment of the EOD project cannot contain any ** capital investment, and if there is a part of the project that uses ** capital investment, this part is not included in the EOD project.
3.In the guidelines for the preparation of the Implementation Guidelines, it is stated in the section on financial analysis and conclusions, "".Ensure that the project funds are self-balanced without relying on ** capital investment. If the project funds cannot be balanced, the project content should be optimized and adjusted according to the actual situation of the project to reduce the project investment and cost. ”
This provision is consistent with what is emphasized in Article 12 of the Implementation Guidelines.
Please note that the content of the three articles on ** funds emphasizes ** capital investment, so right".Input"How to understand? The places involved in the life cycle of a project include: 1. the total investment of the project, that is, the financing; 2. Various costs of the project; 3. The income generated during the operation period of the project. The total investment of the project must belong to the investment, and this part must not contain ** funds in accordance with the provisions of the "Implementation Guidelines". However, if the income of the project includes ** funds (such as various awards and subsidies), it is an income for the project implementation entity, and whether it is an investment in the project?
2. Relationship between funding and EOD projects
For example, in order to implement the spirit of the policy of the superior and promote the development of local industries, a certain place has issued the "Implementation Plan of the Grassland Ecological Protection Subsidy and Incentive Policy in XX County in 2023". The subsidy funds specified in the content of the program** are provincial and municipal financial funds; The subsidy objects are new production and operation entities, planting bases (cooperatives), and production and processing entities; The subsidy method is to adopt the method of "build first and then supplement", and the project unit will raise funds for construction first, and cash out the subsidy funds after the project is accepted; The content and standards of the subsidy are: industrial development subsidy of xx yuan per mu, field construction subsidy of xx yuan per meter, subsidy of xx yuan per head, equipment purchase subsidy, loan interest subsidy, etc.
It is assumed that in the planning and packaging of local EOD projects, the industrial projects included in the scope of EOD projects are fully in line with the above-mentioned ecological protection subsidy incentive policy, and the policy is not specially issued for EOD projects, but is aimed at all market entities within the jurisdiction of the local **, which is universal. The industrial project shall obtain the corresponding subsidy funds in accordance with the policy provisions, but due to the restriction of "no ** capital investment" in the "Implementation Guidelines", can this type of income not be obtained by the EOD project implementation entity? The EOD project implementation entity has obtained this part of the subsidy funds, which is the first capital investment?
From a logical point of view, the income of ecological environment-dependent industrial projects is insufficient and unstable, and it is more difficult to develop the industry to make up for the ecological governance investment that belongs to the first power. If the income is sufficient, there is no need to introduce subsidy policies to encourage the development of the corresponding industries. There is a saying that says, "If capital has fifty percent profit, it will take risks; If there is a 100% profit, it dares to trample on all the laws of the world; If there is a profit of three hundred percent, it dares to commit any crime, and even hanged! ”
Some people will say that it is a package of ecologically sensitive industrial projects and talent-gathering industrial projects, which have high profit margins and sufficient returns. From the perspective of the eight storage scopes specified in Circular 6 and the ecological and environmental governance content stipulated in Article 7 of the Implementation Guidelines, there is little overlap with these two types of projects, and the relevance of EOD project requirements is limited. Digital economy, clean medicine, precision instruments, and high-tech innovation and entrepreneurship industry projects all emphasize factors such as location advantages, convenient logistics, and talent mobility.
Only first- and second-tier cities meet these conditions and are attractive to talents, but how can third- and fourth-tier cities develop such industries? How can industries without sufficient income feed back the investment in ecological governance? Perhaps policymakers in the Implementation Guidelines will say that they have clearly stipulated in the Implementation Guidelines that EOD projects should prioritize relevance and balance of funding, and then consider the systematization and integrity of ecological governance, that is, achieve project self-balancing by investing less in ecological governance. However, this still cannot solve the problem that the project itself has little income and needs to take financial measures to stimulate the development of the industry.
In addition, the Implementation Guidelines stipulate that EOD projects are approved as a whole by enterprise investment projects. In the "Investment Regulations", it is stipulated that the investment funds can be arranged in the form of investment subsidies and loan discounts for enterprise investment projects. The "Implementation Guidelines" must implement the spirit of preventing new local hidden debts, learn from the lessons learned in the implementation of PPP projects in the past, and worry about the use of a large number of ** inputs (** payments) and subsidies (feasibility gap subsidies) for EOD project packaging. But the conflict problem in the EOD project mentioned above exists, and a one-size-fits-all approach is debatable.
There is also a possibility that the policy makers of the "Implementation Guidelines" understand the connotation of the word "investment" only to determine that the investment in the project is the first investment, and the first subsidy in the project income is not considered investment. However, when the project needs to be financed and the project implementation needs to be reviewed and supervised, and the policy wording is unclear, the policy applicators (financial institutions, administrative supervision departments) should practice according to their own understanding.
3. What is the "corresponding reward" in the EOD project contract?
Article 19 of the Implementation Guidelines stipulates that "after the project implementation entity is determined in accordance with laws and regulations, the project organization entity and the implementing entity shall sign an EOD project contract. The contract should focus on the objectives and responsibilities of the project's ecological and environmental governance, the quality and standards of operation and maintenance, and the evaluation and supervision and management methods of the projectCorresponding rewardsand penalty clauses, etc. The contract shall not stipulate in any form matters involving hidden debts, such as expenditure responsibilities and financing guarantees. ”
The implementation guidelines do not clarify the corresponding awards, so can it be used as a supplementary fund? Or are they other policy incentives?
In the EOD project, the goal of improving the quality of the ecological environment should be based on quantitative goals, and a certain amount of financial rewards should be taken in order to assess whether the implementation subject meets the standards in the governance process. If there are no rewards but only punishments, then the rewards and punishments are unbalanced, and it is difficult to promote the development of EOD projects.
4. Recommendations
In general, the "Implementation Guidelines" have a further guiding role in the implementation of national EOD projects, further clarifying the connotations of the two types of subjects, clarifying the content standards of ecological governance and industrial content, but there are still related problems such as unclear connotations of useful terms.
It is suggested that the connotation of "investment" of ** funds discussed in this article should be further clarified, and how to apply the income from mineral resources trading to Natural Resources Gui [2019] No. 6 to ensure the reasonable income of the social investment entity undertaking the restoration project also needs to be further clarified.
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