A Study On The Country Risk Assessment In Foreign Direct Investment For Chinese Resource-oriented Enterprise

With the rapid economic development, the resources constraint have become the important issues influencing our country's economic development. To solve this problem, we actively implement the "going out" policy to invest and explore the overseas resources. At present, our country actively operate the "going out" strategy, and it become inevitable to gain resources for economic development through investment by Chinese resource-oriented enterprises. During foreign direct investment process, resource-oriented enterprises face many uncertainty and uncontrollable risks, one type of which are the risks from outside factors such as national politics, policy, social development that beyond the enterprise's control instead of the factors inside the enterprise. This kind of risk is called as country risk in foreign direct investment. In recent years, there are many failure cases of Chinese resource-oriented enterprises' investments caused by country risk.This paper firstly analyzes country risk of Chinese resource-oriented enterprises in foreign direct investment. After comparing various country risk assessment measures, it evaluates the country risk of foreign direct investment by resource-oriented enterprises of China through AHP. This avoids the defects of more qualitative analysis and less quantitative analysis in the country risk assessment measures. Based on present situations, characteristics and investment failure cases of Chinese resource-oriented enterprises, this paper sums up types of the country risk concluding three categories and ten little types. This paper constructs country risk assessment system of resource-type enterprises in foreign direct investment. The country risk can be divided into political risk index indicators, legal and policy risk assessment index indicators and economic risk assessment index indicators. Using AHP, we carry on the level of single sorting and total sorting and establish national risk score. This paper empirically studies country risk of foreign direct investment in the potash resources of China, evaluates the country risk of Laos, Thailand, Russia, and finds that the country risk of the three countries increase in turn.