The Movement Of International Capital And The Study Of China Utilizing Foreign Capital

Since the middle of the 1980's, with the accelerated development of economic globaliztion, significant changes have taken place in the movement of international capital concerning three aspects as scale, form and speed. Under this circumstance, it creates a more favourable external environment for the economic development of developing countries and proyides broader space for international cooperation. Meanwhile, it also brings severe challenges to the financial stability, economic security and long-term economic development of developing countries.After twenty years of reform, china has become the hot spot of international investment. The large movement of international capital has alleviated the capital shortage in the process of economic development, and accelerated violent increase of export-oriented economy, which makes national economy develop along the track of industrialization, marketization and internationalization. What's more, due to the entrance of international capital, especially the spillover effect and learning by doing of foreign direct investment, technical standards and organizing efficiency have constantly been improved so that total factor productivity has been improved. Since the 1990's , with the continuous enlargement of the scale of international capital movement, there have appeared new characteristics in the internationalization of China's economy, that is, turning from the guidance of trade to the guidance of capital. Foreign direct investment in China not only determines nearly half of the total amount of foreign trade, but also directly determines the fluctuation of reserve assets and the balance of international revenue and expenditure, which plays more and more important role in the rapid and stable increase of national economy. How to approach China's economy in the movement of international capital? How to evaluate the policies by which China has made use of foreign capital in the past 20 years? How to meet the needs of the developed international economic situation? How to adapt the policy of making use of foreign capital on time. All these are becoming the hot spot of academic circles and government.The purpose of this article is to give a systematic research and analysis to the problem of China making use of foreign capital. This article investigates the global trend of the movement of international capital on the basis of theories and documents available and analyses the necessity of China taking part in it from the characteristics of the movement of international capital. Then, it discusses the tactics and strategies of China making use of foreign capital to develop the national economy. In view of the very important practical significance of this task, it strives to take the theory of the movement of international capital as a guidance. After fully absorbing the rational part of direct international investment theory of our time, consulting the latest achievements of overseas direct investment research of some transnational corporation domestically and abroad, through applying a way of qualitative andquantitative analysis combined with the theory and case analysis, this article tries to give an analysis and discussion of necessity, characteristics and problems of China making use of foreign capital and the problem of how to choose policies.This article includes three parts altogether.The first part explains the theory of international capital movement, explains the necessity of developing countries utilizing the foreign capitals, analyses the new trend of international capital movement.The second part studies the current situation and characteristics of China utilizing foreign capitals, makes a concrete analysis of the current situation of our country utilizing the foreign capitals, and systematically summarizes the new characteristics that China utilizes the foreign capitals.The third part analyses the questions of existing in course of China utilizing foreign capitals and studies the policies to choose. Through analysing the questions, it puts forward the policy recommendations on how adjust the policies to response the new characteristics of international capital movement.China ought to conform to the international trend of the times to make use of foreign capital actively , rationally and effectively, and it is unwise to limit the foreign capital. In contrast, China should extend the length and broaden the width of making use of foreign capital to let it make greater contribution to the development of China's economy.