CHINA'S EXPERIENCE IN CAPITAL ACCOUNT LIBERALIZATION THROUGH INVESTMENT PROGRAMS

ОПЫТ КИТАЯ В ЛИБЕРАЛИЗАЦИИ СЧЕТА ОПЕРАЦИЙ С КАПИТАЛОМ ЧЕРЕЗ ПРОГРАММЫ СТИМУЛИРОВАНИЯ ИНВЕСТИЦИЙ

Evgeniy A. Vasyukov (Васюков Е.А.)
Additional contact information
Evgeniy A. Vasyukov (Васюков Е.А.): Lomonosov Moscow State University

State and Municipal Management Scholar Notes, 2023, vol. 1, 285-292

Abstract: Relevance. The Chinese economy is not only one of the largest economies in the world, but also a country that has shown high GDP growth rates over the past 10 years. After opening the capital account, foreign investment became the basis of the economy. Despite several global periods of turbulence, China has been able to accumulate significant experience in stimulating the inflow of long-term financial flows. This was made possible by extensive government programs aimed at both portfolio investment and FDI. Objective. Study the practice and results of using various foreign investment stimulation programs. Methodology. The main methods were systemic and historical approaches, with the use of which it was possible to establish patterns and highlight the distinctive features of investment programs. Findings. Since Chinese economy’s growth required creation and development of entire industries in a short period of time, FDI became a priority. With achieving net recipient of investments status, along with the accumulation of the best industry practices, local national manufacturers developed significantly. This became especially important in the transition to a growth model based on domestic demand. To deepen the financial markets, special portfolio investment programs were introduced. The presence of strict controls over the movement of various types of capital made it possible, on the one hand, to reduce the inflow and outflow of speculative capital, but on the other hand, bureaucratic procedures and the need for approvals undermined the growth and development of competition. The gradual liberalization of controls, the development of investment schemes and the arrival of investors have made it possible to significantly improve the quality of the functioning of the stock market, and currency repatriation rules allow flexible management of exchange rate pressures. All this was embodied in a stable inflow of investments and low risks of a sudden outflows, which was illustrated trade wars and the pandemic.

Keywords: stimulation of foreign direct investment; portfolio investment, China's currency policy, financial markets, capital movement (search for similar items in EconPapers)
Date: 2023
References: Add references at CitEc
Citations:

Downloads: (external link)
ftp://w82.ranepa.ru/rnp/smmscn/s23140.pdf

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:rnp:smmscn:s23140

Access Statistics for this article

State and Municipal Management Scholar Notes is currently edited by Tatiana Ignatova

More articles in State and Municipal Management Scholar Notes from Russian Presidential Academy of National Economy and Public Administration Contact information at EDIRC.
Bibliographic data for series maintained by RANEPA maintainer ().