Country Economic Risk Assessment In The FDI Process

Since China began to promote the implementation of the "going out" strategy, China’s outward foreign direct investment is growing rapidly. However, operating performance of Chinese enterprises foreign direct investment is not optimistic. With the scale of Chinese enterprise about foreign direct investment, Chinese enterprise is faced with Investment Risk increased significantly. Therefore, a correct understanding of China’s Foreign Direct Investment Risk, effectively prevented the Investment Risk, is the decision-making core problem of our country enterprise about foreign direct investment.Analysis and recognition in the process of the enterprise of foreign direct investment risks, especially the country economic risk, it is very important. Accurately measure the country economic risk during the process of foreign direct investment, helps to promote our country enterprise implementation of the strategy of "going out".The main contents of this paper are as follows:The first chapter of the introduction, is an overview about the research of this paper. Mainly includes the research background, research object of this article, research methods, research ideas and innovations in this paper.The second chapter is about the national economic risk theory research were reviewed. Through the brief summary of country risk by the credit rating agencies abroad, the assessment indicators adopted are analyzed comprehensively that the assessment system chosen is not perfect.The third chapter is about the establishment of the evaluation index system of country economic risk. Based on the full analysis of existing research results, the author summarized the evaluation index system and confirmed seven basic core of evaluation system:GDP, monetary, balance of payments, foreign debt, foreign exchange, foreign trade, foreign investment. Through the above analysis, the paper build the country’s economic risk evaluation index system. The fourth chapter is mainly introduced based on improved principal component analysis (PCA) of the country’s economic risk evaluation theory and method. Evaluation method using the improved principal component analysis (PCA). Improved principal component analysis method is compared with the traditional principal component analysis method, there are two improvements. First, the standardized method is improved. The traditional methods uses the center Standardization---zcore. zcore standardization losses amount of information. This article uses the mean standardization. the mean standardization losses less information than zcore standardization. Second, the weighting method is improved. In this paper, we use entropy value method. Entropy method is more objectively.The fifth chapter carries on the empirical research. We found that:in this paper, adopted by the national bureau of economic risk evaluation standard system compared with the existing evaluation system of the country’s economic risk assessment more comprehensive, and more comprehensive and perfect. Improved principal component of the comprehensive evaluation method is compared with the traditional principal component comprehensive evaluation method, the weight set on a more reasonable, the evaluation results more close to the actual performance with sovereign state economy.