1, the rapid growth of international direct investment;
The international capital market is expanding rapidly. The scale of international capital market mainly refers to the number of international loans (medium and long term) and international securities investment;
The trading volume of international foreign exchange market has expanded. Capital flow, especially short-term capital flow, has dominated the international financial market. Monetary capital has moved independently of world production and international trade, and the resulting separation of monetary capital movement and commodity movement also constitutes an important feature of contemporary capital flow;
4. Multinational corporations have become the protagonists in promoting international capital flows. Multinational companies have huge capital, huge production scale, advanced science and technology, global business strategy, modern management means and global sales network, which play a significant role in promoting the development of "borderless economy".
Causes of international capital flow
The main reasons of international capital flow are interest spread, economic growth prospect, policy environment and legal guarantee, currency exchange rate, risk factors and so on.
1, interest rate difference
There are differences in interest rates among countries, and investors will seek opportunities for high returns. When a country's interest rate is high, it may attract capital investment from other countries. This interest rate difference enables investors to find more attractive investment options and get higher profits from them.
2. Prospects for economic growth
Investors usually tend to invest their funds in countries or regions with great economic growth potential. When a country has a good economic environment and active industrial development, it will attract more international capital inflows. This is because investors hope to get more returns from the fast-growing economy and share the opportunities brought by its development.
3. Policy environment and legal guarantee
The policy environment and legal guarantee of a country have an important influence on capital flow. Free market policy, open investment environment, sound legal system and friendly policies for foreign-funded enterprises can attract more international capital inflows. On the contrary, high taxes, trade barriers, political instability or imperfect laws may hinder capital flows.
4. Currency exchange rate
Exchange rate fluctuations have an important impact on international capital flows. When a country's currency depreciates, foreign investors can buy the country's assets at a lower cost, thus increasing the motivation of capital inflow. On the other hand, if a country's currency appreciates, it may reduce its attractiveness to foreign investors.
5. Risk factors
Risk refers to the uncertainty faced by capital investment and the possibility of loss, which depends on the political, economic and social factors of each country. Generally speaking, countries or regions with political stability, economic development and social harmony will reduce the risk of capital investment.
On the contrary, it will increase the risk of capital investment. The higher the risk, the more capital tends to seek higher rate of return to compensate for the risk, and vice versa.