The Analysis Of Financial Crisis In China Based On The Analysis Of Financial Crises In EMC

Since 1970s, as the process of financial liberalization continuously pushing forward, emerging market countries of the world continue to make economic achievements. However, along with the financial liberalization and international capital rapid flow in the world, financial crises in emerging market countries frequently outbreak. As China joined WTO and gradually opens the capital market, the rapid flow of international capital will have an adverse impact on China's good economy operation and thus the danger of a financial crisis breaking out may exist.On the basis of the fundamental perspective, the financial panic views and perspectives of moral hazard on financial crisis, and from the perspective of international capital flows, combining the qualitative and quantitative methods of analysis,this paper will analyze the cause of financial crisis outbreak in emerging market countries. Then, the same method of analysis will be used to analyze factors endangering China's financial security and then obtain the evaluation of current status of China's financial soundness.Through a great deal of data and factual analysis, this paper reaches a few conclusions that, in terms of GDP and foreign exchange reserves, huge external debt and especially short-term external debt is the main cause of financial crises in emerging market countries; and the premature opening of domestic capital market and the implementation of financial liberalization will make domestic financial institutions and enterprises face greater risks; the confidence of investors will be reversed, due to adverse events, to make an adverse impact on the national currency; the result is sharp fall of national currency value and bankruptcy of domestic financial institutions. Compared with the emerging market countries, the scale of China's external debt is fairly reasonable in terms of GDP and foreign exchange reserves right now. China also actively improves domestic financial system and institutions at the same time of opening its capital market. At this stage it is hard for the international short-term capital flow to endanger China's financial security. At present, the excess liquidity result of long-term huge BOP surplus will make an impact on the stable operation of economic.