Study On Investment Agency Of Civil-Military Integration Equipment R&D

As technological element level of weapons and their fighting capacity are becomingdetermining factors in modern warfares, research and development (R&D) onequipments is also playing an important role in national defense construction and defenseweaponry development under high-tech conditions. The heavier of technology content inmilitary hardware weights, the larger of the externality, hazard and cost on equipment’sR&D increases correspondingly. Governmental investment by itself has fallen short ofthe demands of modern warfare and development of weapons and equipment, which callsfor the entrance of social capital into equipment’s R&D to make up. Under thebackground of bearing rich countries and civil-military integration, accompany withmarket economy and fair competition, to establish investment agency which emphasizedthe integration of military and civilian industry has been high on the agenda.Leading private funds orderly supportting equipment R&D has become a importantstep to accomplish civil-military integration (CMI). The paper focused on problems existin equipment R&D field of dull information, meager distribution, hysteresis ofcommercialization of research findings, feeble investment control, partake costly andinvestment risk uncontrollable, then put forward that introducing investment agency intoequipment R&D of CMI was a effective solution on solving the problems mentionedabove. It firstly introduced background, concepts and theory on investment agency ofCMI equipment R&D, and then analysed current situation on CMI R&D investment,pointing out that root cause lay in the segmentation between military and civilian,insufficient competition, blocked Investment channel, poor investment structure andbarriered local capital. Secondly, the paper analysed necessity and feasibility oninvestment agency of CMI equipment R&D: necessities included modernization ofnational defense, CMI of equipment construction and augment of equipment investmentreturns; the feasibilities included close relation of industry bases, resource complementsof military and civilian industry, the national oriented supporting policies andeffectiveness of external funding. The hardcore of paper was that it made comprehensiveand deep analysis on investment agency of existence form, basic function and operationalmode. The investment agency existed in ways of the investment class equipment R&Dinvestment intermediaries, the equipment finance class R&D investment intermediaries,Insurance and equipment R&D investment intermediaries and the information theinformation class equipment R&D investment intermediaries. Basic functions were toguarantee information equivalence, implement supervision, the investment financingguarantees, reduce transaction costs, the cost savings involved in capital flows insurance,manage risk and services to create value. Analysing from a view of basic investment fundoperation flow, the operation procedure of investment agency on CMI equipment R&D could be distributed into four stages. They were assessing stage on investment projects,financing stage on investment projects, performing stage of investment contracts andsupervising stage on investment projects. Finally, the paper suggested that in order tointroduce investment agency in to CMI equipment R&D investment, several policieswere needed on changing perception, speeding up the information exchange andexploring ways to establish and improve investment agency.