Professor Minggui Yu, the co-director of the base ,has published a collaborative paper titled "The Real Economy Promotion Effect of Fiscal-Financial Coordination: A Credit Creation Perspective" in the Issue 3, 2025 of Economic Research. This journal is recognized as an A+ category journal in economics by Zhongnan University of Economics and Law.

Summary: 

The Third Plenary Session of the 20th Central Committee of the Communist Party of China emphasized the need to coordinate reforms in fiscal, tax, and financial sectors to improve the macroeconomic governance system. To strengthen fiscal-financial coordination, local governments across China have implemented the Government Procurement Contract Financing Policy (abbreviated as the "GovProcure Loan" Policy). This policy enables small and medium-sized enterprises (SMEs) to use future receivables from government procurement contracts as collateral for bank loans. It also establishes a dedicated "Government-Enterprise-Bank" account to ensure that contract payments are directed to this account for loan repayment. Leveraging the implementation of the "GovProcure Loan" Policy as a quasi-natural experiment, this paper investigates whether fiscal-financial coordination can alleviate SME financing constraints and promote real economy development. The results show that the policy significantly increases bank loans to SMEs through credit creation effects. Furthermore, the policy enhances SME investment and employment. This study provides critical policy insights: innovative fiscal-financial coordination mechanisms can activate existing government resources, amplify credit creation, support real economy growth, and achieve a tripartite win-win scenario where governments avoid additional fiscal burdens, enterprises gain collateral, and financial institutions obtain secure assets. Future reforms should further leverage the collateral-creation function of fiscal policies to channel financial resources toward the real economy, while optimizing local government debt structures and mitigating regional debt risks to foster a virtuous fiscal-financial interaction.

Keywords: Fiscal-Financial Coordination; Collateral; Credit Creation; Real Economy Promotion Effect

Author profile

Minggui Yu is the Dean of the School of Finance at Zhongnan University of Economics and Law, a second-grade professor, doctoral supervisor, Chief Expert of Major Projects of the National Social Science Fund, and an Outstanding Talent of the New Century by the Ministry of Education. His research areas include Digital Finance, Finance and Artificial Intelligence, Corporate Finance, and Finance and Innovation. He has published over 90 academic papers in authoritative domestic and international journals such as Economic Research, Management World, The World Economy, China Economic Quarterly, Journal of Financial Research, China Industrial Economics, Accounting and Finance, Pacific-Basin Finance Journal, and Economic Modelling. He has led more than 10 research projects, including Major Projects and Key Projects of the National Social Science Fund, and projects of the National Natural Science Fund.

Mengmeng ZHANG, Ph.D. Candidate, Economics and Management School, Wuhan University.

Jianfeng AN, Ph.D. Candidate, School of Finance, Zhongnan University of Economics and Law.