Expert calls for careful planning as more enterprises expand abroad
The latest phaseof
Channelsforforeign investment and financing are increasingly diverse and now extendtoemerging markets.
China'snon-financialoverseas direct investment reached $88 billion in 2013. It wentinto 179 countriesand regions.As many domesticcompanies are looking overseas for growth, theymust learn to handle a widerange of risks and challenges, Wang Qinmin, chairmanof the All-ChinaFederation of Industry and Commerce, told a forum.
According toShenLiangjun, deputy director-general of the corporation project appraisaldivisionof the China Development Bank, the risks are particularly high foroverseasmining investments.
"Manycountrieswant to maximize the economic and social benefits of their mineralresources,making it difficult for Chinese companies to invest in minerals andcausing a'lose-lose' outcome for both sides," said Shen.
Overseasresourceprojects may also be affected by investment policy changes, socialturmoil,labor policy and other issues, Shen said.
"Chineseinvestorsshould fully consider the policies of a country where they plan toinvest,including policies on taxation, finance, environmental protection,exports,mining and foreign exchange controls.
"Theyshouldalso be aware of whether the country has a sound legal system andwhether itslaws are strictly enforced," said Shen.
Beyondthoroughinvestigation and risk analysis, Chinese companies should pay attentiontoevery detail concerning a project and make contingency plans.
"Someexecutivesin charge of a foreign investment project are too confident. Theydon't payenough attention to the details of a project," said Shen.
FromChina Daily 2014-02-28
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