A Study on the Impact of RMB Exchange Rate Fluctuations on China’s Outward FDI

Yunlu Cai ()
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Yunlu Cai: Shanghai University of Finance and Economics

A chapter in Proceedings of the 2025 3rd International Academic Conference on Management Innovation and Economic Development (MIED 2025), 2025, pp 103-109 from Springer

Abstract: Abstract Amidst economic globalization, the RMB exchange rate’s variability has significantly impacted China’s foreign direct investment (FDI). As China’s economy slowly merges into the international market, fluctuations in the RMB exchange rate influence not just the yield and expense of overseas investments, but also significantly shape the investment choices and strategic structure of Chinese companies. The dissertation delves into the context and traits of RMB exchange rate variances, integrating them with real-world data and scenarios to investigate how these fluctuations specifically affect China’s external foreign direct investments and uncover the underlying mechanisms. Findings from the research indicate that variations in the RMB exchange rate significantly influence the magnitude, trajectory, and risk control of Foreign Direct Investment, particularly amid heightened unpredictability in the global market, leading to more adaptable and risk-averse investment patterns in companies.

Keywords: RMB exchange rate fluctuation; outward foreign direct investment; impact mechanism; Chinese economy (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:spr:advbcp:978-94-6463-835-6_12

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DOI: 10.2991/978-94-6463-835-6_12

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