Analysis Of Political Risks Of Chinese Enterprises' Direct Investment In Australia's Resources Secter

The Foreign direct investment of China is roaring in recent years.China has taken the investment in Australia as an important way to improve the bilateral partnership and upgrade the economic corporation.The expanding of China's direct investment in Australia is being attached more and more importance by the government.However,as the improvement of the FDI of China,some political factors like lack of political mutual trust and the limit of investigation policy have been affecting the investment,even have conducted failure,especially when it comes to the investment in resources sectors.The paper has studied some policies and cases of China's investment inAustralia,with the expectation of knowing the political risks and the causes of them,as well as come up with some reasonable suggestions for Chinese enterprises which plan to invest in Australia's resources sector.Based on the research of theory and literature,this article explained the investment environment of Australia,and introduced the policies and limitations.After that,we introduce three cases including success and failure in the investment in Australia's resources sector to analyze the political risks and provide some suggestions for the enterprises.The cases of failure or concession include Aluminum Group's investment in Rio Tinto Ltd.and China Min metals Corporation's investment in OZ Minerals,which may provide proof or deepen our understanding of the political risks,while the paper also introduced a successful case of China Molybdenum's investment in North Parkes.By the analysis of cases,the paper is able to know how the risks work and the causes of them,and also give us some inspiration in FDI in the resources sector.Through the lessons of the three cases,and combined with theory and literature,the paper has come up with some suggestions about how to escape and deal with thepolitical risks of investment in Australia's resources sectors,which is a combination of theory and practice.China's enterprises should focus on market-oriented operation,respect the interests of the host country,pay attention to public relations,and select suitable capital resources to avoid the risks of government reject the investment and the pressure of public opinion.The Internationalization and direct investment overseas of China's enterprises are keys to improve our competitiveness,and also promote the further development,so the study of political risks and the learning from experience and very important.