Research On Overseas Investment Risk And Control Path Of Mining Enterprises In China

Mineral resources are the material basis of national economic development.China is a country which is rich in mineral resources,but the per capita share is deficient.It is difficult to completely meet the needs of the sustainable development of domestic economy.Obtaining resources from other countries has become an important supplementary way.With the development of global economic integration,capital flows more frequently among international markets.Large state-owned mining enterprises actively respond to the “going out” strategy,and make use of “two markets and two resources” to achieve “double circulation” in home and abroad.Under the new situation of domestic and international environment,the uncertainty factors involved in the investment process have increased dramatically,which may lead to the risk and economic losses.Therefore,mining enterprises need to assess and control the risk scientifically.Considering the mentioned background,the overall idea of this thesis is presented as follows.According to the existing literatures and theoretical studies,this thesis identifies risk factors in the overseas investment process of Chinese mining enterprises by using the method of factor analysis and structural equation model.Then this thesis combines the information entropy weigh with normal cloud matter element model to evaluate the location risk of overseas investment.After that the AHP-GRA model is established to evaluate the project risk of overseas investment.Based on the above analysis,this thesis builds the SD Simulation Model by utilizing system dynamics,The SD model is used to simulate the dynamic development of the whole risk system.According to the results of simulation,this thesis puts forward the corresponding control measures.The main research contents include the following five parts:(1)This thesis introduces the research background and the significance of Chinese mining enterprises’ overseas investment risk evaluation and control.Through filtering out the existing works on overseas investment risk,this thesis analyzes the overall situation about overseas investment of Chinese mining enterprises.Subsequently this thesis identifies the basic concepts,explains the risk management theory relating to overseas investment of mining enterprises,and presents the risk measuring theory involving information entropy,cloud matter-element,grey analysis and system dynamics.These basic concepts and theories provide important theoretical proof and support for the follow-up model analysis.(2)Based on the literatures review of overseas investment risk of Chinese mining enterprises,this thesis preliminarily selects 47 indicators to measure the level of investment risk.By using the software tools SPSS 24.0 and Amos graphics 23.0,this study conducts exploratory factor analysis and confirmatory factor analysis to discriminate the pivotal risk indicators.Furthermore,structural equation model is employed to set up the list of overseas investment risk of Chinese mining enterprises.Eventually,the risk list summarizes three categories,nine aspects and forty risk indicators.The risk identification results of factor analysis show that globalization itself does not have threats.In the new international situation,mining enterprises should paid great attention to international political factors,such as geopolitics,big country factors,bilateral relationship and so on.(3)This thesis exploits information entropy weight and normal cloud matter element model to evaluate the location selection risk of Chinese mining enterprises’ overseas investment.The risk level of top 10 overseas countries with bauxite reserves is evaluated in the light of 40 indicators in the risk list.The data are collected through questionnaire method.The weight of indicators is determined by calculating the information entropy.The normal cloud mate element model is run by MATLAB software.The risk assessment results of location selection show that Guinea in Africa is the only one country with relatively low risk.Brazil,Jamaica,Greece and Suriname are at the level of general risk.Australia,Vietnam,Indonesia and Guyana are at the level of relatively high risk.India has a high level of risk.(4)This thesis conducts AHP-GRA model to evaluate the project risk of Chinese mining enterprises’ overseas investment.According to the actual condition of Boffa bauxite project in Guinea,30 risk indicators are screened out from the risk list to evaluate the risk level of investment project.This thesis uses the AHP method to estimate the index weight,calculates the whitening weight function to confirm the grey grade of the risk indicator,and further adopts GRA model to comprehensively evaluate the project risk.The model analysis results reveal the risk level of the secondary indicators,primary indicators,and the Boffa project.The conclusion is that the Boffa project is at a general risk level which has an increasing trend because of COVID-19 epidemics.(5)According to the theory and method of system dynamics,this thesis establishes a system dynamics model of overseas investment risk of Chinese mining enterprises.The weight of location selection risk evolution is used to fit the horizontal variable function.The data of risk identification are utilized to fit the other linear risk relationships.The operating data of Boffa project are explored to apportion the risk value of boundary variables.This thesis draws causality diagram and SD flow diagram to simulate the overall system risk by taking advantage of Vensim software.Through adjusting the control parameters,four risk control schemes are designed including macro avoidance type,meso early warning type,micro control type and comprehensive consideration type.After comparing and analyzing these different schemes,the best path of risk prevention is selected and the specific risk controlling suggestions are put forward.The main innovations of this research include the following three points:(1)By using factor analysis and structural equation model,this thesis identifies the key risk factors that affect the overseas investment of Chinese mining enterprises.And then,the risk list of overseas investment of Chinese mining enterprises is constructed by comprehensively using the test of reliability,validity and model adaptability.This study extends the boundary of the existing overseas investment risk evaluation index system of mining enterprises,and is a supplement to the traditional theory under the new situation at home and abroad.(2)A two-stage risk assessment method is established.In order to ascertain the country with low level risk,this thesis makes use of information entropy weight and normal cloud matter element model to evaluate the location selection risk.Similarly,in order to distinguish the risk level of specific project,AHP-GRA model is conducted to evaluate the project risk of Chinese mining enterprises’ overseas investment.This study breaks through the limitation of single research object,method and approach in the existing research,and adopts a more coherent and rigorous longitudinal progressive research to evaluate the risk of overseas investment of Chinese mining enterprises.(3)The SD Simulation Model of overseas investment risk of Chinese mining enterprises is constructed in terms of the system dynamics method.The results of simulation present different schemes of risk management and control.After comparing these different schemes,the optimal path of risk control is selected.This hierarchical and diversified study is the improvement of the existing relevant research,which makes the management and control of overseas investment risk of mining enterprises more objective and comprehensive.