The current situation of China s use of foreign capital, why should China introduce foreign capital

Summary. Hello, dear. Foreign investment refers to the capital inflow from other countries and regions (including Hong Kong, Macao and Taiwan) to the mainland for the main purpose of engaging in economic and social activities, under the premise of complying with local laws and regulations, following the rules of market mechanism, and in line with the principle of mutual benefit and reciprocity.

In China, there are three main ways to use foreign capital: foreign direct investment (FDI), foreign borrowing and other foreign investment, of which FDI accounts for a large proportion. The introduction of foreign capital can alleviate China's overall financial pressure and promote economic vitality, and also reflects China's good development momentum.

Hello, dear. Foreign investment refers to the capital inflow from the sole proprietorship, joint venture, equity participation and other markets of other countries and regions (including Hong Kong, Macao and Taiwan) to engage in economic and social activities as the main purpose, under the premise of complying with the laws and regulations of the local legal bureau, following the rules of market mechanism, and in line with the principle of mutual benefit and reciprocity. In China, there are three main ways to use foreign capital:

FDI accounts for a large proportion of foreign direct investment (FDI), outward borrowing and other foreign investment. The introduction of foreign capital can alleviate China's overall financial pressure and promote the vitality of the economy, and also reflects China's good development momentum.

Dear, you are so wanton. The introduction of foreign capital is a matter of killing three birds with one stone, along with the introduction of advanced technology and a large foreign market. It is the inevitability of disturbing the opening up to the outside world, the beginning of substantial fission.

At present, there are only two forms of foreign capital utilization in China: foreign direct investment and foreign capital loans. Foreign direct investment does not create debt problems, and foreign debt is the use of foreign loans. At present, China's foreign exchange reserves are sufficient, and the current foreign debts can be repaid on schedule.

The positive impact of foreign direct investment on China's economic growth mainly includes six aspects:

1. Increase domestic investment and promote capital formation;

2. Absorb labor employment;

3. Improve TFP of comprehensive factor productivity;

4. Promote the upgrading of China's industrial structure;

5. Expand the scale of China's foreign trade, improve the structure of China's foreign trade, and promote the development of foreign trade.

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On the whole, the influx of foreign capital has both positive and negative effects on China's economy.

1.Positive impact.

Promote sustained and rapid economic growth and increase fiscal revenue.

Promote the optimization and upgrading of the industrial structure.

It has promoted the rapid development of China's foreign countries.

Improve the technical level of China's industry.

Increase total employment.

Promote the establishment and improvement of China's modern enterprise system.

2.Negative impacts.

The formation of a monopoly on certain industries and markets, resulting in the loss of a large number of national brands.

Weaken the independent innovation ability of Chinese enterprises.

Loss of state-owned assets through improper operation or transfer pricing.

Exacerbate the shortage of resources and deteriorate the ecological environment.

It will exacerbate the imbalance in China's regional economic development.

The phenomenon of industrial isomorphism is relatively serious.