A Study On The Risk Identification And The Mode Of Combination Of Industrial Capital And Financial Capital Between China And Kazakhstan

Under the background of“The Belt and Road” construction and “International Cooperation on Equipment Manufacturing Capacity”,Kazakhstan,as the core area of “the Silk Road Economic Belt”,which has geographical advantages,political stability advantages and economic complementarily advantages,is a template of China's international cooperation.However,bilateral trade and investment cooperation between China and Kazakhstan is still in a single mode and lacks of driving force.Therefore,it is urgent for the two countries to seek a multi-functional and multi-factor cooperation mode in order to deepen bilateral economic and trade cooperation and promote regional economic prosperity.This paper mainly focuses on the industrial capital and financial capital between China and Kazakhstan,using the international capital flow theory,international factor combination theory and the combination of industrial capital and financial capital theory,analyzes the combination of industrial capital and financial capital between China and Kazakhstan in the framework of“analyzing the economic logic judgment—judging the flow direction,selection of combination and motivation—summing up the characteristics—identifying the key risk factors—seeking the combination mode”.The paper analyzes the economic logic of the combination of industry capital and financial capital between China and Kazakhstan,then studies its flow direction,selection,motivation and characteristics.It also measures the risk correlation and identifies the key risk factors.Learning from international experience;we put forward government level mode and regional development level mode.The main conclusions include:1.Judges the industrial capital and financial capital's flow direction,combined selection and motivation.(1)To compare the potential ofindustrial capital and financial capital to analyze the flow direction of the two capitals.(1)China and Kazakhstan's industrial capital and financial capital flows asymmetrically;Capital outflow from China and the absorption of capital from Kazakhstan is complementary.(2)China's two kinds of capital are in a higher level,and flow into Kazakhstan.(2)There are four choices of combination,inclueding choice I(China's industrial capital combined with Kazakhstan's industrial capital),choice II(China's financial capital combined with Kazakhstan's industrial capital),choice III(China's industrial capital combined with Kazakhstan's financial capital),and choice IV(China's financial capital combined with Kazakhstan's financial capital).We take combination I and combination II as the main research object,in which the former shows a kind of industrial allocation of industrial capital localization,and the latter shows the initial stage of localization of transnational banks' financial capital,that is,the initial level of combination of financial capital and industrial capital.(3)To reveal the thrust factors and the gravitational factors of combination I and combination II.2.Sums up the characteristics of the combination of China's industrial capital,financial capital and Kazakhstan's industrial capital.(1)Features of Combination I: Combined mainly with the state-owned enterprises and is policy oriented;Combined with the form of FDI based on industrial configuration;mainly rely on mergers and acquisitions or projects.(2)Features of Combination II: The main body of combination is "state-owned component”;the level of combination is still in the primary stage,and the platform is based on the international capital market.All in all,the main part of combination I and combination II are state-owned sectors,while the degree of combination I is higher than that of combination II.3.Identifies the risk of the combination of China's industrial capital,financial capital and Kazakhstan's industrial capital.The purpose is to construct the framework and index system of risk factors and identify the key risks.(1)Qualitatively analyzes the risk factors which affect combination I and combination II,including economic risk,financial risk,political risk,legal risk and institutional risk.(2)Builds a risk framework and index system.(1)Uses factor analysis to quantify the comprehensive score of five kinds of risks.(2)Measures the correlation between combination I and combination II,and five types of risk by using the correlation coefficient calculation.The results show that: combination I is significantly associated with four types of risks except economic risk,and economic risk,financial and institutional risk is significantly related to the combination II.(3)The regression mode is introduced to identify the key risk factors.,which include: bank ownership and interest rate control(financial risk);political stability and political security(political risks);contract law enforcement(legal risk);institutional barriers(institutional risk).The key risk factors for combination II include inflation and foreign capital profitability(economic risk);financial development and financial deepening level(financial risk);institutional barriers(institutional risk).In addition,financial risk and institutional risk are the common risk factors that affect the combination I and combination II,and the institutional risk is the most significant factor.4.Explores the mode of combination between China's industrial capital and financial capital and Kazakhstan's industrial capital.According to the characteristics and the key risk factors of combination I and combination II,this part puts forward a new combination mode include national level and regional development level.(1)Summarizes the international industrial capital and financial capital combination mode,in order to provide a mode for reference with combinations of industrial capital and financial capital between China and Kazakhstan.(2)Puts forward a new mode at the national level:(1)the Combination I includes “Industrial capital—FDI—Cross complementary industrial chain” mode and “Industrial capital—AIIB,Silk Road Fund—capacity cooperation”mode.(2)the Combination II include“financial capital—infrastructure construction—Asset Securitization”mode.(3)Puts forward a regional development level mode:(1)the“Khorgos international border cooperation center + port economy” mode;(2)The “special economic zone” mode.The innovation of this paper lies in:(1)This paper systematically studies the transnational flow and combination of industrial capital and financial capital between China and Kazakhstan.(2)This paper establishes the risk index system,identifies the key risk factors and puts forward government level modes and regional development modes,which can provide a realistic basis for deepening cooperation in the region,and supplement the related research.