ANALYSIS ON THE RISKS OF CHINA'S DIRECT INVESTMENT IN AFRICA AND THE COUNTERMEASURES

Abstract

Since the establishment of Forum on China-Africa Cooperation, China's Direct investment in Africa has the characteristics as follows: rapid development of investment scale, enriched investment fields and diversified investors. While the investment proportion in Africa of total China’s OFDI is still small and the investment mainly concentrates on certain Africa countries. Most importantly, in the process of China’s investment in Africa, investment risks are rising, many investment projects have suffered setbacks or failures. Chinese enterprises face with political risk, corruption risk, environmental risk and public opinion risk in process of direct investment in Africa. Therefore, enterprises should improve the ability to control and prevent the risk, investment strategy should be optimized according to local conditions, as well as fulfill the environmental responsibility and enhance the voice in Africa to improve the international image.