Research On The Risks Of International Trade Financing For The Foreign Trade Company Lu’an City

With the development of global economic integration, the ways and means of international trade cooperation has become increasingly diverse. Small and medium foreign trade enterprises, as a key component part of main market players in China, are confronted with challenges, in which financing issues are prominent. Owing to the increase of various risks as well as the widening gap in international trade finance business between Chinese and foreign commercial banks, the development of China’s import and export trade is severely inhibited. Since international trade finance business can not only alleviate the current financial problems for enterprises, but also help them avoid all kinds of potential risks, it has become a hot topic on promoting the development of China’s import and export trade, which receives increasing attention from the government, financial institutions and foreign trade enterprises. The study of the issues on international trade finance in global situation from the perspective of small and medium foreign enterprises has important practical significance for easing the pressure of foreign trade enterprises, promoting the development of foreign trade finance, boosting the growth of export trade and accelerating the economic recovery.This study applies the research method of combining theory with practice and takes the risk management in international trade finance of foreign trade enterprises as its research object. By the use of literature research method, comparative study, quantitative and qualitative analysis, as well as case analysis, it analyzes the issues on the risk management in international trade finance business of foreign trade enterprises, in which it figures out some effective approaches to the risk management in international trade finance of foreign trade enterprises by taking the specific circumstances of foreign trade enterprises in Lu’an as examples. Conclusions:banking institutions should pay attention to those foreign trade enterprises that obtain financial support by means of trade finance and make more efforts to support foreign trade enterprises in international trade finance; meanwhile, foreign trade enterprises should improve their awareness and ability of risk control. Outlook:the society and the government should improve the international trade finance system of foreign trade enterprises, that is to say, the legal and international environment of import and export trade needs to be improved, and policies in terms of the support for foreign trade enterprises should be further strengthened.The chapters of this thesis are organized as follows:Firstly, it introduces the research background, significance, ideas, methods, literature review, object, structure and innovation of the research; secondly, proceeding from the analysis of foreign trade enterprises’current situation, it introduces the concept of international trade finance as well as the problems and shortcomings in its risk management, on this basis, it proves the necessity of the research on the risk management in international trade finance; then, it deduces the framework and content of the risk management in trade finance, including: the definition, identification, measurement, transfer and control of risks; next, this thesis takes the foreign trade enterprises in Lu’an as examples and introduces the status, distribution and extent of their trade finance risks as well as the problems of risk management in their current international trade finance, finally, on the basis of above-mentioned risk analysis, this thesis proposes concrete solutions to the prevention and management of the risks in international trade finance.Innovation of this thesis:exploring the risks in international trade finance by dint of standard methods of analysis; placing emphasis on the combination of theory and practice, theoretically summarizing and analyzing some phenomena in the practice so as to reveal its root causes; combining micro and macro analysis, that is, to see through the overall situation from the perspective of individuals and extend from local part to the whole part; emphasizing comparative analysis, that is, to sum up the situation and trends of the development of international trade finance business through horizontal and vertical comparison.