The Current Situation, Risk And Prevention Of Chinese Overseas Investment

As Deutsche Bank claimed in one report made by it in 2007, China's oversea direct investment was expected to increase by 20% in the following five years and mount up to $60 billion. One survey made lately by World Bank showed that 58.9% of Chinese enterprises planed to invest overseas while 12.9% had the intension to do so. Going out has already become Chinese enterprises' consensus.An analysis of the current situation of Chinese overseas investment demonstrates that Chinese foreign direct investment has a rapid development and the investment model has a constant innovation. Manufacturing bases or R& D centers are established by means of joint venture, rebuilding and acquisition. The foreign direct investment fields are being expanded all over the world as well as the industrial distributions developed. The subject of investment has gradually transformed from the single state-owned enterprises to the diversified pattern of the private enterprises, local government-supported enterprises and national enterprises.However, the investment risk goes hand in hand with the growth of the investment scale. With the purpose of identifying the cause and effect of Chinese overseas investment risks as well as improving the probability of the success, the author of this thesis will classify the risks into political risk, investment decision-making risk, management risk and foreign exchange risk, and will come up with the prevention measures against these four categories of risks.