Research On Risk Identification Of Major Projects Of China's Foreign Directinvestment Under The Background Of "One Belt And One Road"

The changes the world pattern facing now is complex and profound.Since thefinancial crisis in 2018,the recovery of the world economy is very slow,and the economy map and rules of the world and its international investment are undergoing deep adjustment.In 2013,Chinese President Xi Jinping put forward the "one belt and one road" initiative.The "One belt and one road" aims at promoting the construction of the framework of economic cooperation between China and other countries along to a border,wider range,and a higher and deeper level.For our domestic enterprises,the construction of "one belt and one road" provides more opportunities for "going out" and cooperation.However,we will also face various investment risks at the same time.It is particularly important to accurately identify the types of risks of foreign direct investment and quantify the important risk factors.In the basis of the "one belt and one road" initiative,identifing the risks of major projects from the perspective of risk identification.Combingqualitative analysis with quantitative analysis,uses HHM-RFRM modelto construct the overall risk identification framework,filters and screensrisks,and after several rounds of filtering and screening,leaves six types of financial risk types.They are risk of inflation,tax risk,interest rate risk exchange rate risk,risk of social and cultural integration in host countries,impact risk of large temporary facilities.In order to locate and identify risks more accurately,based on these four types of financial risks,using Monte Carlo simulation method to simulate the experiment and specifically study the impact of nine risk factors on the overall financial level risk,as well as rank the risk values of the risk factors from the simulation test.Analying the test results,suggestions on financial risks are given.In the analysis,it can be found that the risk factors of inflation rate rank first,followed by tax burden level,host country's tax policy,interest rate fluctuation,economic instability,imbalance between deposit and loan and other factors.By calculating the sensitivity of various risk factors,this study finds that inflation rateis more sensitive than other risk factors.It argues that inflation risk can be reduced by signing long-term purchase contracts,agreeing on price change clauses and shortening construction period.When dealing with tax risks,investors should always pay attention tothe host country's tax system and preferential tax policies.When tax disputes arise,they should be good at using legal provisions to safeguard their rights reasonably.in order to cope with interest rate risk,investors have to adopt flexible and changeable operating mechanism to identify the opportunities brought by the change of interest rate market.Exchange rate risk can be solved by buying and selling foreign exchange in the foreign exchange forward market,signing foreign exchange management agreements,and determining appropriate transfer pricing,etc.