Risk avoidance is a method to deal with risks, that is, to eliminate risks or conditions under which risks occur through changes in plans and protect targets from risks. Avoiding risks does not mean completely eliminating risks. What we want to avoid is the possible losses caused by risks. First, it is necessary to reduce the loss probability, mainly by taking pre-control measures; The second is to reduce the degree of loss, mainly including pre-control and post-remedy.

Measures to avoid risks:

One is to completely avoid risks, that is, to avoid the source of risks by giving up or refusing to cooperate to stop business activities. Although potential or uncertain losses can be avoided, the opportunity to gain benefits will also be lost.

Second, the control of risk loss is to reduce the loss degree by supporting the loss probability.

Third, transfer risk, that is, transfer the potential losses that you may follow to the other party or the third party in some way.

Fourth, risk retention can be passive, active, unconscious or conscious. Because it is sometimes impossible or obviously unfavorable to completely avoid risks, this planned risk retention is a way to avoid risks.

Ways to avoid risks:

Risk control, risk transfer and risk avoidance can be adopted.

Risk control is:

(1) Diversification of international operations; ② Decentralized financing; 3 local currency pricing; ④ Balance offset method; ⑤ Combination pairing method; ⑥ Reciprocal Trade Law.

Risk transfer is:

(1) Strive to use hard currency export and loan capital export; Import and loan funds are invested to strive to use soft currency; ② Forward foreign exchange transactions; ③ foreign exchange options trading; (4) settlement in advance or delayed; (5) using forfaiting for trading; ⑥ Risk insurance.

Ways to avoid risks:

(1) Choice of currency in negotiation; ② currency preservation.