Abstract: This paper is on financing mode for the shanty towns reconstruction. Firstly, this paper outlined research literatures relevant to the financing for squatter settlements. Secondly, it analyzed the features of financing mode for the transformation of squatter settlements in Liaoning province. Thirdly, it focused on the problems of the financing mode. At last, this paper provided relevant suggestions to settle the problems. The features of the financing mode in the Liaoning practice were as follows, one was the wider range of financing channels, the second was the government’s important role in mobilization of such a wide range of funds, and the third was that commercial funds played a main role in financing for the transformation of squatter settlements. The paper also pointed out some problems of the financing mode in the Liaoning practice, the first was that whether the policy incentives were appropriate or not. The second was that the policy incentives lacked credit enhancement for the loan from commercial banks. The third was that too much fund came from commercial banks, and the fourth was the absence of community finance. The resolutions to these problems included disclosing the policy incentives, introducing the competition mechanism among the enterprises which participated in the transformation of squatter settlements, diversifying the commercial fund, and establishing system of community finance.
Keywords: Shanty Towns Reconstruction, Financing Mode, Community Finance
source:Finance & Trade Economics ,No2,2014