Risk Assessment And Countermeasures Of China’s Direct Investment In Vietnam

Since 1991,when the first Chinese company invested in Vietnam,China and Vietnam have maintained relatively stable political and economic cooperation.The governments of China and Vietnam signed the Bilateral Investment Agreement in1992 and reached a cooperation strategy of "Two Corridors and One Circle" in2004.In 2015,China and Vietnam signed the China-Vietnam Joint Statement,which for the first time proposed to strategically link the "Two Corridors and One Circle" strategy with the "21st Century Maritime Silk Road".Investment cooperation between China and Vietnam has gradually become the main way of economic cooperation between China and Vietnam.The overall scale of China’s direct investment in Vietnam continues to grow,and the investment flow and stock are on a steady upward trend.The investment covers manufacturing,real estate,infrastructure,energy,digital economy and other fields.Since 2018,while the scale of Chinese enterprises’ investment in Vietnam has been expanding,they are also faced with more investment risks.With the impact of multiple risks,such as Sino-US trade friction,the rise of trade protectionism and the outbreak of COVID-19,the global political and economic situation has become more turbulent and the competition between countries has become more intense.In addition,there is national sentiment and political resistance to Chinese companies in Vietnam due to historical issues between China and Vietnam.Therefore,While facing the opportunities brought by China-Vietnam economic and trade cooperation,Chinese enterprises should also pay attention to guard against the ensuing risks and challenges,and improve the ability of the Chinese government and enterprises to deal with various risks in their direct investment in Vietnam.Based on this,this paper firstly sorts out the development trend of China’s direct investment in Vietnam,then identifies the risk factors of China’s direct investment in Vietnam,and constructs the risk index system and evaluation model of OFDI by using PEST analysis method.Secondly,The Principal Component Analysis and Entropy Method are used to comprehensively evaluate the risk of China’s direct investment in Vietnam.Meanwhile,other countries along the "Belt and Road" are used as reference objects to compare the size and ranking of China’s direct investment risk in Vietnam.Then,based on the support vector regression machine algorithm,an early warning model of foreign direct investment risk is constructed and an early warning judgment of Vietnam investment risk is made.Finally,from the government level and enterprise level respectively from the political risk,economic risk,market and technology risk and social risk four dimensions of risk prevention measures.Through relevant discussion and demonstration,this paper shows that,first of all,among the risks of China’s direct investment in Vietnam,economic risk is the most prominent risk,followed by social risk,market and technological risk is the least.Secondly,among the 31 countries along the "Belt and Road",Vietnam ranks relatively low in terms of investment risk.Compared with other countries,Vietnam’s investment risk is still at a high level.However,the overall of OFDI risk is improving and there is still great potential for future investment in Vietnam.Thirdly,by constructing a risk early warning system for Chinese direct investment in Vietnam,the study finds that the comprehensive risk early warning for Chinese direct investment in Vietnam is a medium warning.When China invests directly in Vietnam,it should be highly vigilant to various risks and alert to the impact of risk changes on the investment.Damaged interests.According to the relevant demonstration results,combined with the results of quantitative assessment and early warning assessment of political risk,economic risk,market and technology risk,social risk and comprehensive risk in China’s investment in Vietnam,this paper puts forward targeted risk prevention measures respectively from the perspectives of the Chinese government and enterprises.