The Analysis On Political Risk Of FDI From China To Asean

Economic globalization brings new opportunities and challenges to the companies’development. To be adapted this trend, China should take its "Go aboard" strategy to look aboard market. while having developed in other countries and regions, and the establishment of the CAFTA(China-ASEAN Free Trade Agreement) bringing new opportunities, the Chinese companies, have begun to invest and develop its market in ASEAN potentially market. However, there are unpredictable risks when inventing in ASEAN, political risk is the main risk. Political risks are unpredictable、uncontrollable, It influents foreign investors’safety and their capital. With little or no experience in foreign investment, if Chinese companies lack the knowledge of ASEAN market, they will fail their investment adventure. Political risks should be the bottleneck of these failures. Therefore we should make out which political risks will affect Chinese companies’investment, how to avoid losses which come from damage of those political risks.Having inspected and studied a large number of literatures, I basically research into the definition, the classification, the cause, the analytical method of the political risk in the paper. The paper first introduces the Chinese investment in ASEAN, then gives out that the political risk is one of the main affection facts in the investment in ASEAN. Then below, the paper discusses the political risks in the Chinese investment in ASEAN. Combining the political risk theory and the specific conditions of Chinese companies’investment in ASEAN, it analyses ASEAN’s own political risk, then shows the political risks causing by the cooperation of China-ASEAN. At last, it gives advises of avoid the political risk in investment in ASEAN.