Analysis On The Effect Of New Policy In Outward Foreign Direct Investment On China's Listed Companies

With the support of the Chinese government for Overseas Direct Investments,the amount of cross-border Mergers and Acquisitions(M&A)investments in China has increased yearly since 2001.In 2016,it increased by 148.6% far higher than in 2015.China's growth is extremely fast in the cross-border M&A market.In 2015 and 2016,China accounted for 13.5% of the world's foreign investment flow,ranking second in the global foreign direct investment.The amount of outflow has exceeded the inflow in China's Investment flow,and it has become one of the largest foreign investment country.However,from the data of non-financial foreign direct investments conducted by Chinese investors in 2017,the total amount of investments was 810.75 billion RMB($120.8bilion).Compared with the same period last year,it dropped by 28.2%.There are some macro-intensive factors of this phenomenon,such as RMB devaluation,trade protectionism,etc.In order to control international risk and prevent irrational blind investments,the more strict supervision and regulation of overseas direct investments carried out by the Chinese government has played a certain role.For example,in the ‘2017suggestions on further guiding and regulating the Overseas Direct Investments' issued by the State Council,the attitude of restricting Overseas Direct Investments is clearly expressed.Industries such as real estate,hotels,film studios,entertainment and sports clubs have all been explicitly restricted in this government regulation.In addition,another new regulation which is called ‘Improvement of Management Mechanism' also points out the specific management plan to establish the blacklist system for Overseas Direct Investments.Furthermore,not only the regulation related with reforming and standardizing the capital project by the State Administration of foreign exchange,but also the measures of supervision and management for foreign investments of Central Enterprises issued by State-owned Assets Supervision and Administration Commission is new regulatory policy in 2016-2017.Those policies all emphasized the strict implementation and strengthening the management of overseas investments.In order to measure the impact of China's new policy on the market,this paper uses the event research method to conduct empirical analysis and divide it into five parts forresearch: the introduction part introduces the background,significance and research methods of the research.The first chapter analyzes the mechanism of the impact of policy factors on the impact of cross-border M&A enterprises.The second chapter is to systematically sort out the evolution of China's cross-border mergers and acquisitions and the evolution of regulatory policies.After observing the changes in China's foreign direct investment model,it summarizes the characteristics of China's cross-border mergers and acquisitions and policies.The third chapter explains in detail the research models,research hypotheses,research and testing processes used in event research,and the research models used in the combing research to observe the cross-border mergers and acquisitions related to China's cross-border M&A transactions for the entire industry and 2017 cross-border M&A transactions.The impact of market value(Combined with the theory of effective market,China's securities market satisfies the semi-strong market,and the securities market can respond more quickly to public information.At the same time,it draws on the research practice and chooses the market value statistical period as eleven days to ensure the validity of the conclusion).Moreover,by further studying the commonalities of the industries and enterprises affected by the impact,the factors affecting the impact of the New Deal on the market are analyzed.The fourth chapter summarizes the impact of the policy on the market,and proposes corresponding policy recommendations based on this conclusion.