On The Improvement Of China’s Overseas Investment Insurance System

The overseas investment insurance system was first established by the United States in 1948 to provide legal protection against losses caused by political risks.Because its system worked,other rich countries followed suit.In November 2002,China Export&Credit Insurance Corporation launched the business of "overseas investment insurance",which meant that China began to attach importance to the protection of the interests of overseas investors from the perspective of system.In 2018,China’s outbound direct investment outflows reached $143.04 billion,the highest ever.In the same year,direct investment in the Belt and Road countries reached us $17.89 billion.China’s overseas investment is booming,but the process has not been smooth sailing,with many unpredictable risks,especially political risks,in the process.In order to better protect the interests of Chinese overseas investors,the overseas investment insurance system must be studied and perfected.This paper is divided into four chapters,which are as follows:The first chapter is the political risk of overseas investment of Chinese enterprises under the "the Belt and Road ".This chapter takes the investment status of Chinese enterprises in the countries along the belt and road as an entry point to introduce the risk profile of the countries along the belt and road.Combining with the political risk cases that Chinese enterprises have encountered,this paper analyzes the political risk of countries along the "the Belt and Road ",and expounds the concept and types of political risk.It also believes that the political risk of"One Belt And One Road" countries will have a negative imprct on the overseas investment of Chinese enterprises.The second chapter is the present situation and shortage of China’s overseas investment insurance system.In terms of legal origin,China’s current overseas investment insurance system mainly includes normative documents of relevant ministries and commissions under the state council.At the specific institutional level,this paper,combined with the business practice of China credit insurance,introduces and analyzes from the following five aspects:underwriting institutions,insuring subjects,qualified investment,insurance acceptance,compensation ratio and procedures.In this paper,the deficiencies of China’s overseas investment insurance system are mainly reflected in the following aspects:lack of clear legislation;The content lacks rationality;The system model has the malpractice;The right of subrogation is null and void;No effective use of the MIGA mechanism;Political risk assessment and early warning mechanism is not perfect in these six aspects.The third chapter is a comparison of the overseas investment insurance systems in the United States,Japan and Germany.This paper compares the overseas investment insurance systems of the three countries from the perspectives of the insurance system model,insurance institutions,underwriting conditions and insurances.By comparing the overseas investment insurance systems of three countries,this paper analyzes their characteristics,advantages and disadvantages,and provides reference for the improvement of China’s overseas investment insurance system.The fourth chapter is some suggestions on improving China’s overseas investment insurance system.Firstly,the establishment of overseas investment insurance legal norms.The State Council shall formulate regulations on overseas investment insurance referring to the"separate legislation model" of Germany.Insurance institutions follow the principle of separate examination and approval authority and executive authority.Ministry of Commerce,Ministry of Finance,Ministry of Foreign Affairs,National Development and Reform Commission appoint experts to form the "China overseas investment insurance ministerial-level committee",which exercises the power of examination and approval and supervision directly under the leadership of the State Council.As the operating institution of overseas investment insurance,China credit insurance shall exercise the executive power.Secondly,we should improve the specific content of the overseas investment insurance system.It is suggested to optimize the conditions of insurance.Qualified insurance holders should include natural persons and legal persons and non-legal organizations registered in China.Qualified investment should first meet the conditions to promote the economic development of the country;The selection of eligible host countries shall be based on the principle of those countries that have signed bilateral investment agreements with China,with the exception of those countries that have not signed bilateral investment agreements;Consider whether to add terrorism insurance and policy and legal changes;The insurance term may be 15 years at the lowest and 20 years at the highest;The minimum amount insured is 90%of the investment loss and the maximum is 95%.Thirdly,we should define subrogation right in overseas investment insurance.As the subject of exercising subrogation right,China Export&Credit Insurance Corporation proposes to unify the provisions of subrogation right in the bilateral investment treaty as far as possible.Fourthly,we shoulud formulate supporting implementation mechanisms.On the one hand,the supporting mechanism for MIGA must be established.Administrative regulations may be promulgated to translate the rights in treaty law into domestic law and put into effect.On the other hand,the government should take the lead to improve the political risk assessment and early warning mechanism.