Research On Risk Control Mechanisn Of The Foreign Direct Investment

With the economic globalization more and more deep, enterprises have to go aboard inorder to survive and further development. However, there are many differences among thecountries, such as political environment, economic level, financial system and so on. It is alsoincreasing the risk of foreign direct investment. So it has much necessary to research theassessment system and control mechanism of country risk.As the second largest economy group in the world, Chinese companies have beenchanged from passive adaptation to going out actively through last twelve years whichChina joined WTO. Chinese companies have paid a heavy price during the process of goingout. The reason why it happened is the lack of scientific risk evaluation system and riskcontrol mechanisms.Based on the summary of present situation and assessment methods of country risk inthe world, assessment system of country risk was established, including three one-levelindexes of political risk, economic risk, financial risk, and22two-level indexes. Theweight of one and two-level indexes is determined by using AHP innovatively which is moresuitable for China. The country risk score of140countries were calculated by using theoriginal data of ICRG in January,2014ˋand then some advices were given. At last, a setof risk control mechanism were established, including risk signal recognition andacquisition, risk monitoring, risk measurement, risk warning report, risk treatment and so on.Besides, the process specific government implementation and quantification of risk signalswere given.