The export of capital, depending on who owns the property, is divided into three types :
1) private export of capital, carried out mainly by the largest industrial companies and banks;
2) state export of capital carried out by the government at the expense of the state budget or by state organizations and companies;
3) export of capital by international monetary and financial companies and organizations.
The movement of capital is carried out in two forms – loan and entrepreneurial capital.
In turn, the form of movement loan capital in the field of international economic relations is international credit.
The following act as loans and borrowers in the international loan capital market: the state, enterprises, international and regional organizations.
International credit fulfills a number of important functions in the field of foreign economic relations.
Ensures the redistribution of financial and material resources between countries, allowing them to be used more efficiently or to satisfy the most pressing needs for borrowed funds.
Strengthens the process of accumulation within the world economy, directing temporarily free funds of some countries to finance capital investments in others.
Accelerates the process of implementation on a global scale, thereby expanding the boundaries of expanded reproduction.
By timing international loans are divided into:
short-term (up to a year),
medium-term (from 1 to 5-7 years)
long-term (over 5-7 years).
Short term loan traditionally used in foreign trade(especially commodities) and international exchange of services.
Exports of machinery and equipment are usually financed using medium-term loan.
Long-term loan used primarily to finance capital investments in infrastructure and production, including large-scale projects on a compensatory basis.
By type loans are divided into:
commodity provided to exporters - mainly commercial (company) loans
monetary provided by exporters and importers in financial and currency form.
A typical type of international government loan in in cash are external loans who have everything signs of credit:
repayment of borrowed amounts,
a certain period of their use,
the need to pay interest for this.
External loans are placed on foreign monetary frameworks both on behalf of the state by banking consortiums and directly by the state. In the latter case, these are intergovernmental loans, often not in bond form.
Peculiarity bond form of borrowing consists in the fact that banks that issue bonds, shares and other securities on the international capital market act here as an intermediary between the borrower and direct creditors - investors who place their funds in these securities.
In international practice, various types of bond loans.
Classic loans are carried out through the public issue of foreign bonds on the national securities market by syndicates of local banks in the appropriate currency with a quotation on the stock exchange of a given country.
Currently they predominate international bond loans, issued on the European market in the currency of a third country by syndicates that are international in their composition. This type of financial loan is called a syndicated euroloan, the source of which is the resources of the eurocurrency market. As a rule, such a loan is organized by large commercial banks that lead the consortium and agree on the terms of the loan with the borrower. The loan term is most often 5-10 years.
Euroloans are usually provided on the basis of regular revision of the interest rate (rollover).
Operations on the European market are carried out in eurocurrencies , that is, currencies in which banks carry out transactions outside the issuing countries of these currencies. For example, dollars held in non-US bank accounts are called Eurodollars.
The main incentive for the development of the Euromarket is the lack of government control over its activities, since bank operations with Eurocurrencies are not subject to the rules and restrictions of national loan capital markets, which makes these operations more profitable compared to lending in national currencies.
The terms of bond loans are very diverse. The interest rate can be fixed for the entire loan term or regularly revised in accordance with international money market conditions.
Also applicable convertible bonds, which, under certain conditions, can be exchanged for shares of the debtor company at a predetermined rate.
Very popular among investors bonds with warrant– a separate document giving the owner the right to purchase shares at a fixed rate during a specified period.
Now let us turn to such a form of capital movement as export of entrepreneurial capital , which is divided into foreign direct investment and portfolio investment.
The export of entrepreneurial capital represents long-term foreign investment in industrial, commercial and other enterprises. Foreign investments serve as a source of cash and sometimes direct property investments in development, expansion, development of new production of goods and services, improvement of technology, mining, and use of natural resources.
Direct foreign investment are called investments in foreign enterprises that provide the investor with control over them.
Such investments most often include investments of such a volume that the foreign investor owns at least 20-25% share capital companies. These are flows of entrepreneurial capital in a form that combines managerial expertise with lending.
According to the International Monetary Fund (IMF), foreign direct investment is a form of investment where the investor has managerial control over the entity in which the capital is invested.
Reasons for the export of capital in the form of foreign direct investment:
1) the desire for the most profitable investment of capital - to reduce transport costs, overcome tariff and non-tariff barriers of foreign countries, access to cheap factors of production or new technologies;
2) creation abroad of our own infrastructure for foreign economic relations (i.e. warehouses, transport enterprises, insurance companies, distribution networks, etc.);
3) obtaining certain advantages in competition with local firms in their market by using with local firms in their market by using differences in national legislation for the most favorable policy in the field of prices and taxes, by maneuvering when changing exchange rates. Income received by direct investors consists of dividends, interest, and license fees for management services.
Portfolio investment – investment of capital in foreign shares, bonds and other securities, carried out in anticipation of high dividends, obtaining a return on capital. Such investments do not give the right to control the activities of a foreign enterprise.
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One of the forms of capital export and a way to penetrate foreign markets is participation in organization of joint ventures .
Joint venture - an international form of organization and implementation of specific economic activities, based on the use of the combined capital of foreign and local founders from two or more countries.
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Joint ventures make it possible to combine funds and other types of resources from different countries and carry out common production and economic activities in the territory of one of them or in each country. They have joint property and finances, each of its participants and founders has the right to exercise management functions. Profit and risk associated with joint activities are distributed in proportion to the share of funds invested by each participant in the joint venture.
International capital migration is the movement of capital between countries, including exports, imports and their functioning abroad.
The reasons for international capital migration are interpreted ambiguously by economists various directions economic thought. Approaches to explaining this process evolve with changes in economic conditions, scales, forms, mechanisms, and consequences of international capital movements.
Capital as a factor of production is, first of all, a stock of durable material goods necessary for the production of other goods. Capital, like labor, can move between countries. Moreover, it is characterized by much more high degree international stability versus labor force.
The movement of financial flows between lenders and borrowers in various countries, between owners and their companies that they own abroad, forms an international movement of capital. Capital migration usually does not involve the physical movement from country to country of industrial buildings and structures, machinery, equipment and other investment goods. When a businessman purchases equipment or any other investment product abroad, such a transaction, as a rule, relates to foreign trade, and not to the international movement of capital. However, if machinery and equipment are transported to another country as a contribution to the authorized capital of a company being created or acquired there, then in this case the transaction will be considered as an export of capital.
On modern stage In the development of the world economy, one of the main factors in the development of international economic relations is the export of capital and its international movements. Such forms of international economic relations as international trade in goods, services, and technologies affect monetary and financial aspects: when carrying out export-import transactions, international payments are carried out, or international loans are required, during international migration work force wage transfers are transferred. Thus, international monetary and credit financial relations are a prerequisite for the development of international economic relations and its consequence.
The current growth rate of capital exports in all its forms is ahead of the growth rate of commodity exports and the growth rate of GDP in industry. developed countries Oh. The largest volume of investments received in the Russian Federation in the first quarter of 2009 was directed from the Netherlands, Luxembourg and Germany, which accounted for 35.9% of all foreign investments in the Russian economy. As of the end of 2010, the total volume of accumulated foreign investment in the Russian economy was $300.1 billion, which was 12% higher than in 2009. In addition, for the first time in the last three years, investments from Russia abroad exceeded the volume of foreign investments in the Russian economy (the excess is estimated at 63.7%).
The formation and development of capital migration began much later than such forms of international economic relations as international trade in goods, international work migration. For the possibility of exporting capital to arise, significant accumulations in the country were required.
This opportunity appears on first stage the evolution of international capital migration, which begins after the completion of the processes of initial accumulation of capital and with the development of capitalist production relations - at the turn of the XVII - XVIII centuries. and lasted until the end of the 19th century. This stage is called the “stage of the emergence of capital export.” Capital migrated exclusively in one direction (from metropolises to colonies) and was of a limited and random nature.
Second phase The evolution of international capital migration begins at the end of the 19th - beginning of the 20th century. and until the middle of the twentieth century, that is, as capitalist production relations were established and spread in the world economy. The process of capital export takes place both between industrial countries and between industrial and developing countries. At this stage, the export of capital became a typical, recurring and characteristic phenomenon.
Thus, the export of capital is the movement (migration) of capital from one country (in which their owner is located) to another country for the purpose of extracting profit (surplus value) or for political purposes. The export of capital is carried out in the form of direct and portfolio investments (entrepreneurial capital, which is long-term investments in commercial, industrial and other enterprises) and loan capital.
When capital is exported, part of the profit (extracted surplus value) is again invested in production (capitalized), and part is returned to the country that “produces” capital. From the mid-50s-60s of the twentieth century. comes third stage evolution of international capital movements, continuing to the present day, in which the ongoing processes are more objectively reflected by the term “international capital migration”. There are several reasons for this:
- 1. The export of capital is carried out not only by industrialized countries, but also by many developing countries and former socialist countries. Thus, in 2009, foreign investment in the group of developing countries amounted to $152 billion, and they, in turn, exported capital in the amount of $74 billion.
- 2. Countries simultaneously become both exporters and importers of capital. Thus, capital investments from EU countries to the USA in 2009 amounted to $279 billion, and at the same time capital worth $263 billion was exported from the United States to the EU countries.
- 3. The export of capital causes significant reverse movements of capital in the form of interest on loans, business profits, and dividends on shares. For example, in 2009 US interest payments on foreign loans amounted to about $87 billion.
Based on the foregoing, international capital migration is the processes of counter movement of capital between different countries of the world economy, regardless of the level of their social economic development, bringing additional income to their owners.
The classification of forms of international capital movement reflects the various aspects of this process. Capital is exported, imported and functions abroad in the following forms.
First of all, a distinction is made between the migration of loan and entrepreneurial capital. The movement of loan capital is carried out in the form of an international loan, and entrepreneurial capital - through foreign investments.
Based on their intended purpose, a distinction is made between direct and portfolio investments. Direct foreign investment occurs when a branch of a national firm is established abroad or a controlling stake in a foreign company is acquired. In contrast, portfolio investments represent a purely financial transaction for the acquisition of foreign securities in foreign currency. Portfolio investments lead to diversification of an economic agent’s portfolio and reduce investment risk.
According to ownership, private and public capital are distinguished. Private capital is represented by the assets of private firms, commercial banks and other non-governmental organizations that move between countries by decision of the governing bodies of these organizations. This could be investments in the creation of foreign production of a private company, the provision of an interbank loan, an export loan, etc. State capital represents funds from the state budget transferred abroad by government decision. It makes movements in the form of loans, advances, foreign aid, etc.
A specific type of public capital is the capital of international economic organizations (IMF, World Bank, UN, etc.). It is formed from contributions from the member countries of these organizations, and is used not simply at the request of a particular country, but by decision of the bodies of international organizations.
And finally, according to the investment period, short-term and long-term capital are distinguished. Short-term capital is considered to be capital provided for a period of up to one year. Typically these are trade credits to stimulate exports or imports. Long-term capital, represented for a period of more than a year, most often appears in the form of direct and portfolio investments, government loans. Specific forms of capital movement are regulated by the national legislation of individual countries and the charters of international organizations.
The majority of international capital flows are portfolio investment, with the main flows of both direct and portfolio investment flowing between developed countries. This is explained, first of all, by structural changes in the world economy under the influence of scientific and technological revolution, the introduction of knowledge-intensive and capital-intensive technologies, growing requirements for the qualifications of the workforce, increased international specialization and production cooperation.
Each of the forms indicated below can characterize the same migrating capital according to a certain characteristic. For example, in international practice, state capital is often exported in loan form, and private and long-term capital is exported in entrepreneurial form.
Forms of international capital migration
IN last decades In international capital migration, there is a tendency to reduce the share of banks from 50% to 25% and a simultaneous increase in the share of capital of transnational corporations. Almost 75% of migrating capital is private capital, and its volumes are growing. The share of state capital among capital migrating in the world economy in 2009 is estimated at 34%. Among the total volume of capital exported to developing countries, 90% is state capital, and to the countries of Eastern Europe and the CIS - about 30% (all this in the form of preferential loans - 35%, interest-free loans - 65%). According to the IMF, in 2009, the world allocated $128 billion for official development assistance to industrially lagging countries. The leaders in providing such assistance are Japan and the United States. The main recipients of official assistance are Israel and Egypt.
The share of international monetary, credit and financial organizations in international capital migration in 2002 was 17%, and it is they that have the highest growth rates. The remaining share of migrating capital comes from mixed entities.
The main forms of international capital migration are the import and export of entrepreneurial and loan capital.
IN modern world, along with intensive trade in goods and services, there is an active movement between countries and production resources: capital and labor. This movement of productive resources is called migration.
Capital migration combines two flows: 1) removal, or export, of capital outside the country; 2) importation, or import of capital into the economy of a given country. The export and import of capital takes the form of foreign (foreign) investments and bank deposits. Exist various shapes capital migration (Fig. 20.2).
Rice. 20.2.
Behind the subject of ownership, capital that migrates around the world has three forms:
private (owned by individuals and companies);
state (owned by the state);
international (possessed by international organizations, for example, IMF, World Bank). According to the nature of its use, it has two forms:
1) loan - these are deposits in foreign banks (when exporting capital) and external loans (when importing capital);
2) entrepreneurial capital - these are investments in enterprises (construction of new ones or acquisition of existing ones, their arrangement).
In turn, entrepreneurial capital has two forms of investment:
- direct investments (investments directly in foreign enterprises, which give the right to control their activities);
- portfolio investment (investments in securities of foreign enterprises in order to receive income from their ownership).
The ratio of direct and portfolio investment is an indicator of the role of foreign capital in the national economy. If the share of direct investment predominates, then this may be a prerequisite for the modernization of domestic enterprises, the use of advanced management experience, increasing employment, and the like. If foreign investors give preference only to the acquisition of securities as such, then there is reason to talk about their temporary interests of this country, that is, purely speculative intentions to receive income from the resale of securities at the right time.
The geography of capital migration today is very diverse and different from what it was before. So, if in the first half of the 20th century. capital was exported mainly to economically backward countries in Asia, Africa, Latin America, then most direct investment now goes to industrialized countries. Today, almost three-quarters of foreign direct investment comes from developed countries and only about a quarter from developing countries. Moreover, there is a cross (counter) movement of capital, in which each country acts as both an exporter and an importer of capital. More importantly, even developing countries have become donors to economically wealthy countries. Of course, rich countries allow themselves such a “luxury.” natural resources(in particular, oil-producing Arab countries), new industrial countries have also joined them ( South Korea, China, Taiwan, etc.). However, there are also poor countries whose rulers consider it safer to keep their (family) huge capital in the holdings of reliable foreign banks or other assets.
The main motives for international capital migration:
The relative excess of capital in a given country, which leads to a decrease in the degree of profitability of its use in it;
the presence of more favorable conditions for doing business abroad (cheap raw materials and labor, low taxes and soft social and environmental requirements, weak competition, etc.);
Opportunities for pooling capital from several countries to implement large and complex business projects, reducing economic risks, etc.;
Expanding markets for its products (by transferring production to other countries);
“capital flight” abroad (can have two meanings: 1) as a natural reaction of business to excessive tax pressure, political instability in a given country, etc.; 2) as a way to hide from taxation of income in offshore zones, payment for fictitious imports, payments for fictitious transactions with securities).
"Capital flight" unfortunately, it is especially characteristic of today’s Ukraine, despite the fact that our country is already long time is experiencing an acute “investment hunger” to modernize production and develop innovation. Thus, direct foreign investments from Ukraine in 2012 amounted to $4.1 billion, but almost all of them (95%) were invested in Cyprus (offshore in the Mediterranean Sea). According to some expert estimates, over the two decades of state independence, capital worth 167 billion has been taken out of Ukraine. At the same time, according to official data, at the beginning of 2013, Ukraine (since 1991) received only $54.5 billion in direct foreign investment, but, notably, the most (almost a third) came from Cyprus - 17.3 billion dollars. It turns out that the capital that flees our country is partially returned, but under the guise of foreign investments, loans and corrupt payments (financing election campaigns and the like). In previous years, such pseudo-foreign investments also had tax preferences from a corrupt state. For comparison: China annually receives foreign direct investment in the amount of almost 60 billion dollars. Such a different “price” of the investment climate in Ukraine and in communist China.
Of course, for every open country foreign investment in its economy is desirable. And direct investments are the most productive, since they contribute to the renewal and development of production. To actively attract foreign direct investment, governments are developing a special economic policy, which includes financial and non-financial incentives. Among the financial incentives for foreign investors, in particular, such means as: direct tax incentives are used; tax deferrals; exemption from customs duties on the import of equipment, components, and raw materials; providing subsidies, preferential loans, etc. Non-financial methods of encouraging the import of capital may include: provision of information, transport and other communications, and the like.
One of effective forms state assistance in attracting foreign capital into the real sector of the economy is the organization of free (or special) economic zones. V Free Economic Zone (FEZ)- this is a state-defined area or territory where, thanks to preferential tax, customs and legislative regimes, especially favorable conditions for business and foreign economic activity are created for investors.
The main goals of creating free economic zones:
1) acceleration of socio-economic development of a certain region (development of production, primarily export, employment, living standards of the population);
2) use of world experience (by attracting foreign capital and organizing joint ventures, introducing advanced technologies, forms and methods of organizing and managing production);
3) expansion of foreign economic relations and inclusion of the region (and through it the entire country into the world economic system;
4) experimental effect (testing of production, economic, organizational and managerial innovations).
Depending on the specific goals, different types of SEZ, in particular these:
- free trade zones (without customs control and collection of duties);
- export production zones (areas of concentration of enterprises working for export);
- scientific and technical zones (“technoparks”, “technopolises” (from the Greek. polis - city), “science parks” and other formations focused on active research and development work (NDEKR), development and implementation of innovative products);
- open areas and cities (usually formed around air, sea and river ports, and other major transport hubs).
Today there are hundreds of different SEZs operating in the world. In the USA, for example, free trade zones are common. Especially great success use SEZs in China: there are six of them there today. It is noteworthy that the Chinese started SEZs back in the late 1970s. and, having quickly tested their model of the country's economic development with their help, adopted an "open door" policy and began economic reforms.
Ukraine in the 1990s. experienced euphoria regarding the prospects for creating SEZs, in particular resort areas in the Carpathian region and Crimea. However, in a corrupt state, these plans were not destined to come true. And those are separate economic zones, which were nevertheless created for the good purpose of helping depressed regions, were actually used to profit businessmen and politicians, and therefore, when the scam was revealed, they were liquidated.
However, when assessing the overall positive role of the export of capital, one must also take into account the fact that it is this factor in modern conditions gave birth to powerful multinational companies.
When opening new enterprises in other countries with less competitive economies or absorbing existing ones, TNCs usually import not the latest equipment and appoint less qualified managers to manage them. Consequently, focusing only on foreign investments, even direct ones, it is extremely difficult for an importing country to break into the number of leading countries in the world that use the latest achievements of scientific and technical progress. In addition, the dominance of foreign capital over time turns into another “surprise” for the importing country - part of its GDP in the form of profits from foreign investors will be transferred abroad, negatively affecting growth rates national economy. And finally, as practice shows, even producers coming from democratically developed countries can also look for illegal ways to enrich themselves, and even interfere in the internal affairs of other states.
Thus, in 2008, during judicial investigations, the German concern Siemens AG, which is the world's second and Europe's largest manufacturer of electrical engineering, electronics and other well-known products, admitted its guilt in bribing government officials in a number of countries, in particular Russia, Iraq, Nigeria, Libya. According to the court verdict, he had to pay a fine of $1.6 billion. Two years later, another German automobile concern, DaimlerBenz AG, paid for the same illegal actions: it used bribes to pave the way for its products in 22 countries.
International migration of labor resources, labor as a factor of production, has acquired a wide scale in the modern world.
International labor migration is the movement of the working-age population from one country to another in search of work and better working and living conditions. At the same time, those who leave their own country forever are called emigrants, and foreigners who arrived in this country for permanent settlement - immigrants.
According to UN research, if in 1990 there were 154 million migrants in the world, now there are already 232 million. The most popular country for immigrants is the United States, where for the period 1990-2013 pp. 23 million people settled. Next come Russia (11 million) and Germany (10 million). According to the same data, 5 million immigrants live in Ukraine.
The main reasons for international labor migration:
1) uneven economic development of countries, the result of which is a relative surplus of the working-age population and a high level of unemployment in some countries and a labor shortage in others;
2) differences in conditions and wages in different countries.
Migration of able-bodied people is a complex and rather contradictory phenomenon. It reflects the pros and cons (gains and losses) both for migrants themselves and for countries and the world as a whole.
The main benefits (+) and losses (-) of the emigrants themselves:
Possible benefits from getting a job, better working conditions and higher salaries;
Losses associated with moving and settling into a new place;
Problems of adaptation to a new linguistic and cultural environment, to a different climate, and the like.
Main losses and benefits for countries of emigration:
Loss of part of GDP and tax revenues to the state budget;
Loss of part of the labor force, including highly qualified personnel; + receiving foreign exchange income in the form money transfers emigrants;
Reducing unemployment and easing social tensions.
Main benefits and losses for immigration countries:
Increase in GDP and tax revenues to the state;
Increasing business profitability due to cheap immigrant labor and its downward pressure on the general level of wages in the country; + savings on education costs and vocational training personnel;
Complications of the local employment problem;
Social tension may arise through various conflicts between the local population and immigrants.
Main benefits for the global economy as a whole:
Increase in global production;
Reducing unemployment;
Bringing peoples and their cultures closer together, creating preconditions for strengthening peace throughout the world.
The benefits of using cheap immigrant labor, especially from developing countries, are aggravated by the fact that such workers agree to any working conditions, take on hard, dirty and dangerous work that the local population refuses, work longer than is allowed in a given country, and even deprived of reliable social protection. Many of them are there illegally, and therefore they can be fired at any time.
Separately, it is worth noting that the greatest loss for the country of labor emigration and at the same time the greatest benefit for the country of immigration is "brain drain". This is understandable, because highly qualified labor (scientists, engineers, designers, doctors, programmers and other specialists) creative professions), Firstly, requires considerable expenses for education and professional training, Secondly, it gives the greatest increase in GDP and, strictly speaking, ensures scientific and technical progress; Thirdly, forms the core of the middle class as a guarantor of stability in society.
For example, a consequence of the fact that the United States was able to create Better conditions For scientific research, this country has the largest number of Nobel Prize winners. Moreover, many of them come from other countries. In the US Silicon Valley, a third of the companies involved in innovative developments were created by people from China and India. The success of the Microsoft company was ensured not only by its founder Be. Gates, but also employs “eggheads” from all over the world, including from post-Soviet countries.
The problem of “brain drain,” unfortunately, has been acute in Ukraine for a long time. To solve it, our society must finally get around to updating state power and carry out the necessary comprehensive reforms that would open up wide opportunities for the use of skilled labor for the benefit of the people themselves and for the benefit of the Motherland. Preserving the intelligence of a nation means preserving its future.
Topic: Essence, causes and forms of international capital migration
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University: VZFEI
Introduction 3
1. The essence of international capital migration and its causes. 4
2. Export of entrepreneurial and loan capital.
Direct and portfolio investments and their mechanisms. eleven
Conclusion 20
References 21
Introduction
International capital migration can be carried out in different forms, which are distinguished by various signs. There is a distinction between public and private export of capital. Capital can move between countries in loan and entrepreneurial form. The provision of loans can be short-, medium- and long-term.
State export of capital- migration can be carried out in entrepreneurial and loan form, in the form of short- and long-term investments, private - in the form of loans and entrepreneurial investments and pursues the goal of increasing income. The loan form of capital export appears in the form of short-, medium- and long-term loans, investments in foreign banks and loans to foreign firms. Entrepreneurial capital outflow can be in the form of direct or portfolio investment.
The export of capital involves a set of credit and financial transactions that make up the global capital market. The structure of this market can be divided into the money market, the bond market and the stock market.
The infrastructure of the global capital market is associated with the activities of international banks, stock exchanges, financial and monetary organizations, transnational corporations and other institutions.
- The essence of international capital migration and its causes.
International capital migration (IMC)- the process of counter-movement of capital between countries, its import and export in order to generate income in the form of profit and its use as a factor in economic growth.
International capital migration- this is the cross-border movement of one of the most important factors of production, resulting from its historically established or acquired concentration in individual countries, creating economic prerequisites for more efficient production of goods and services in other countries.
The objective reason for the international migration of capital is the uneven economic development of countries in the world economy, which in practice is expressed in the unevenness of capital accumulation in different countries and the discrepancy between the demand for capital and its supply in individual parts of the world economy.
Among the main reasons for capital migration we can also highlight:
Different marginal productivity of capital, determined interest rate(capital moves from where its productivity is low to where it is high);
The desire of firms to internationally diversify their activities;
The presence of customs barriers that interfere with the import of goods and thereby push foreign suppliers to import capital to penetrate the market;
Stable political situation and a generally favorable investment climate.
A group of factors stimulating capital migration can be identified:
International industrial cooperation, investments of TNCs in foreign subsidiaries;
The economic policy of industrialized countries aimed at attracting significant amounts of capital to maintain economic growth rates, employment levels, and the development of advanced industries;
The economic behavior of developing countries seeking to attract foreign capital for their economic development by liberalizing the investment climate;
Carrying out a policy of liberalization of the international investment space by international organizations, developing universal norms for investment cooperation;
International agreements on the avoidance of double taxation of income and capital between countries, promoting the development of trade and attracting investment.
The classification of forms of international capital movement reflects various aspects of this process and can be carried out according to various indicators.
1. Based on the sources of origin, private and public investments are distinguished.
Government investment is government loans, loans, grants, assistance, the international movement of which is determined by intergovernmental agreements. Private investments are funds from non-state sources placed abroad or received from abroad by private individuals (individuals and legal entities).
2. Based on the form of capital export, the movement of capital in monetary and commodity forms is distinguished. Thus, the export of capital can be machinery and equipment, patents and know-how, if they are exported abroad as a contribution or components authorized capital company created or acquired there. Another example would be trade loans.
3. By the nature of their use, foreign investments are either loan or entrepreneurial.
Capital in loan form brings its owner income mainly in the form of interest on deposits, loans and credits, and capital in entrepreneurial form - mainly in the form of profit.
4. According to the intended purpose, foreign capital investments are divided into direct, portfolio and other investments. Foreign direct investment (FDI) is the acquisition of a share or block of shares (10 percent or more) of a foreign company for the purpose of participating in the management of the enterprise. Direct investments also include loans from parent organizations to their foreign branches. Basically, foreign direct investment is private entrepreneurial capital.
Unlike direct investments, portfolio investments represent a purely financial transaction for the acquisition of foreign securities that do not provide the possibility of direct control over the activities of the foreign investment object, but only give the right to income.
Other investments include mainly international loans and bank deposits.
5. Based on the subjects of capital migration, a distinction is made between the macro and micro levels. Macro level - interstate capital flow. Statistically, it is reflected in the country's balance of payments. Micro level - capital movement within international companies through intracorporate channels.
6. By directions of capital flows:
Currency, credit and settlement services for the purchase and sale of goods and services;
Foreign investments in fixed and working capital;
Transactions with securities and various financial instruments;
Currency operations;
Redistribution of part of the national income through the budget in the form of assistance to developing countries and state contributions to international organizations, etc.
By investing capital abroad, an investor makes international investments - investing in securities of issuers from other countries denominated in foreign currency, as well as in financial instruments purchased for foreign currency.
The internationalization of investment activity is aimed at eliminating non-economic barriers and creating conditions under which for investors the differences between making investments in their own country and abroad virtually disappear.
Statistics of capital migration in Russia.
The economic crisis accelerated the reduction in the influx of foreign investment into Russia: if in 2008 this inflow decreased by 14.2%, then in 2009 it decreased by another 21.0% - to $81.9 billion. At the same time, repayment (that is, withdrawal from countries) of previously received investments increased in 2009 by 12.8% - to $76.7 billion. As a result, the difference between these indicators for the year decreased almost seven times - from a very significant $35.7 billion in 2008 to barely noticeable against the backdrop of the Russian economy (and even Russian budget) 5.2 billion in 2009.
In addition to the ratio of the inflow and repayment of foreign investments, an important indicator of the situation in the country is the ratio of the influx of foreign investments with the outflow of their own, Russian ones. We know on large number examples that those operations that are statistically formalized as Russian investments abroad are very often a manifestation of simple flight of capital or even citizens (for example, when buying an apartment or house abroad).
Before the start of the crisis, in the last completely prosperous year of 2007, foreign investment in Russia exceeded investment from Russia by more than a third, amounting to 120.9 against 74.6 billion dollars. The panic of 2008 turned the situation around: the investment balance became negative (there were investments in Russia 103.8 billion, 114.3 went out of it). However, the stabilization of 2009 did not fundamentally change the state of affairs: investments from Russia exceeded foreign investments in Russia (82.6 versus 81.9 billion dollars).
At the same time, investment directions Russian funds leaves no doubt that we are mainly dealing with capital flight.
It is enough to point out that the largest place for investing Russian capital has become Switzerland - an ideal place to store money, but not at all easy to earn it. $34.9 billion went to Switzerland—more than 40% of Russian investments abroad.
The 2nd and 3rd places in terms of investment from Russia (for the same reasons) are the Netherlands ($10.7 billion) and Austria, which is only $1 million behind.
In 4th place is Belarus - $6.5 billion (probably due to the purchase of relatively inexpensive real estate and the migration of business to a country where, despite all the shortcomings political system 300 thousand entrepreneurs are not in prison), in 5th and 6th places are Cyprus ($6.0 billion) and Great Britain ($1.8 billion), followed by Ukraine ($1.6 billion) , USA (1.5 billion) and offshore Virgin Islands ($1.1 billion).
True, foreign investment in Russia also largely gives the impression of a return of Russian capital. This is natural: foreign investors in our country, unlike domestic ones, have someone to protect, so our businessmen quite often withdraw money from the country simply in order to save their business.
Luxembourg became the largest investor in Russia ($11.7 billion). China suddenly became third (after Luxembourg and the Netherlands) (investing $9.8 billion compared to $0.4 billion in 2008), fourth was Cyprus (8.3 billion) and only fifth was Germany ($7.4 billion). .).
Speaking about “foreign investment in Russia”, it should be remembered that basically we're talking about about loans and short-term transactions on the stock market, speculative in nature - and this, naturally, in conditions of insecurity of property. The share of speculative investments and loans in the total volume of foreign investments is 88.4% (data based on last year).
The foregoing clearly shows that there is no hope for their massive influx as a factor in the stabilization and, especially, modernization of Russia, and the reason lies not so much in the deterioration of the situation, but in the fundamental, despite the global crisis, reason for this deterioration - the arbitrariness of the corrupt Russian bureaucracy.
- Export of entrepreneurial and loan capital. Direct and portfolio investments and their mechanisms.
Because the export of capital- this is the movement of money abroad either for the purpose of extracting business profit, or for the purpose of receiving interest, so it is customary to distinguish between the export of capital in two forms: business and loan.
Entrepreneurial capital is directly or indirectly invested in production and is associated with obtaining a certain amount of rights to receive profit in the form of dividends. Most often, private capital comes into play here. Loan capital means lending funds to earn interest. Capital from government sources is active here, but operations from private sources are also very significant.
Recently, international scientific and technical assistance has become increasingly relevant. Scientific and technical assistance - grants, subsidies for free consultations, engineering assistance, supply of equipment, development of economic, financial, technical programs, internships and training abroad. The goal is to create conditions for the export of capital through development market relations, the necessary capital investment. Creates conditions for making profits.
Entrepreneurial capital .
Entrepreneurial capital- this is capital invested in direct and portfolio investments, such as the acquisition or organization of companies, the purchase of securities of companies and firms.
The export of entrepreneurial capital is carried out in several ways:
- firstly, through the construction of own (or share) enterprises abroad;
- secondly, through the acquisition of either a controlling stake, or simply part of the shares of existing enterprises;
- thirdly, by opening its own branches or subsidiaries abroad.
Capital investments in foreign enterprises, depending on control over the latter, are divided into direct and portfolio. Direct investment gives the right to control foreign enterprises. This right is a result of owning a controlling stake in these companies. In international statistics, direct investments include those when a foreign investor has at least 25% of the share capital of a company. Portfolio investment is the acquisition of shares of foreign enterprises in amounts that do not provide ownership or control over them.
Direct investments .
Direct investments— investment of funds (investments) for the purpose of participating in the management of the enterprise in which the money is invested and receiving income from participation in its activities.
In accordance with the accepted international classification of foreign investments, direct investments include investments as a result of which the investor receives a share in the authorized capital of the enterprise of at least 10%. Acquiring a share in the capital of an enterprise of at least this amount makes it possible to directly participate in the management of the enterprise, in particular, to have a representative on the board of directors.
Direct investments allow you to directly influence the invested business. In the modern world, there is a tendency to increase the volume of direct investment.
Direct investments are usually carried out through Private Equity funds (direct investment funds) - specialized companies that have obligations of their “subscribers” to transfer pre-agreed amounts of money if the fund approves certain transactions. The subscriber's interest is to make a profit after the fund closes 3-5 years after its creation by selling all invested companies to strategic investors or other funds.
Foreign direct investment is divided into outgoing, i.e. direct investments made by entities of a given country abroad, and incoming, i.e. direct investments made by foreign investors in a given country. The ratio of incoming and outgoing investments shows the international investment position of a country.
Portfolio investment.
Portfolio investment represent the purchase of securities, shares, shares, which amount to no more than 10% of the organization’s share capital. Portfolio investing is used to make a profit on speculation.
Portfolio investments differ from ordinary investments in that their profits are associated with various speculative operations, while ordinary investments are associated with the real sector of the economy. Although there are cases when investments do not differ from each other, for example, in the situation when shares of an organization that issues material goods are purchased.
Direct and portfolio investments have virtually no boundaries. Different countries set this limit differently, usually the difference is 10%. Portfolio investments do not involve obtaining control over the affairs of the company, additional benefits as a result of managing the company and taking part in economic activity. The goal of a portfolio investor is to earn high income by increasing the value of the invested capital (an example of this would be stocks) as well as income in the current period (for example, stock dividends). In this case, the investor does not invest a real or financial asset in one investment, but creates one portfolio from a large number of assets.
There are several types of investment portfolios. It depends on the degree of risk and the source of profit. A growth investment portfolio is formed from securities whose value is constantly increasing. The permanent income portfolio is formed when minimal risk, includes highly reliable securities, but brings not high, but average income. A high-income portfolio consists of high-yielding securities, the profit comes from dividends on stocks and interest on bonds, in this case the income is high. Combined income is formed to eliminate losses in the stock market, the reasons for which may be low interest and dividend payments, or a drop in market value.
Portfolio investments have a peculiarity. It lies in the fact that when the profitability of one share changes, there is a risk of a change in the profitability of the remaining shares that are included in the investment portfolio. High constant income can be achieved by purchasing high-yield and reliable bonds and holding them until maturity.
Loan capital .
Loan capital- this is capital that is provided in the form of a loan on the terms of repayment with the payment of interest.
The global loan capital market acts as a combination of supply and demand for loan capital from borrowers and loans from different countries. Its function is to accumulate and redistribute financial resources on a worldwide scale. Debt obligations are traded on this market, which confirm the creditor’s right to collect the debt from the debtor.
Depending on the terms for which the loan is provided, it is divided into long-term (about 10 years), medium-term (2-3 years) and short-term (3-6 months and maximum up to a year). According to the sources of funds, international loans come in the forms of bank loans and commercial loans. Private firms or banks act as creditors, government bodies and international financial institutions.
Debt obligations can be classified based on the degree of their guarantee, which, in turn, is related to who is the debtor under these obligations.
1. State debt- debt that is acquired by the government or autonomous government agencies. Public debt arises from obtaining loans from other governments, central banks, government and government agencies. Public debt is also considered to be debt incurred as a result of receiving loans from international organizations.
2. Government guaranteed debt- debt of private companies, payments for which are guaranteed by the state.
3. Private non-guaranteed debt- debt of private companies, payments for which are not guaranteed by the state. Private debt arises as a result of firms obtaining loans from foreign banks and firms placing corporate bonds on the world market.
Initially, loan capital moved within national borders, but as historical development and the expansion of international economic relations, countries were involved in international credit relations and the connection of separate national markets for loan capital.
The global market for loan capital has a special institutional structure. It is based on professional intermediaries between borrowers and lenders from different countries. Such intermediaries are transnational banks, financial companies, stock exchanges and other financial and credit institutions operating at the international level.
Stock Exchange is an institution that functions systematically and regularly, where purchase and sale of securities registered (i.e., quoted) on it is carried out.
OTC market- is both a rival of stock exchanges and their organic complement. It arose as an alternative to exchange turnover, because many new companies could not enter the exchanges with the securities they issued, due to the fact that their parameters did not meet the criteria presented on the exchange for their quotation.
The global capital market has a certain geographical localization. There are a number of international financial centers in which numerous financial institutions serving international capital movements are concentrated.
For the functioning of an international financial center, a high level of economic development of a given country, its active participation in world trade, the presence of a national capital market and a developed banking system, liberal currency and tax legislation, and relative political stability are necessary. Currently, the world's financial centers include New York, London, Zurich, Frankfurt am Main, Tokyo, Singapore, Hong Kong and some others.
Tests.
1. Which of the following applies to direct investment (choose the correct answer):
a) a French entrepreneur purchases shares of General Motors for $5 million;
b) he buys a house in Washington for his family to live;
c) the French company merges with the American one, and the shareholders of the French company partially exchange their shares for shares of the American company;
Answer : d) an Italian company builds a plant in Russia and operates it under a contract with a Russian manufacturer.
Because Direct investment is the investment of funds (investments) for the purpose of participating in the management of the enterprise in which the money is invested, and receiving income from participation in its activities. (investor ownership of 50% or more of the capital with voting rights; concentration of 25% or more of the capital in the hands of one owner; the dominant role of foreigners in the practice of determining the policies of the enterprise.)
2. The export of capital from the country in loan form means (choose the correct answer):
a) investments in the economy of a particular country in order to receive interest;
b) investments in the economy of a particular country for the purpose of making a profit;
c) is part of the export of entrepreneurial capital.
Answer: a) investments in the economy of a particular country in order to receive interest.
Because Loan capital is capital that is provided in the form of a loan on the terms of repayment with the payment of loan interest.
3. Making long-term investments in the economies of foreign countries with the aim of making a profit is (choose the correct answers):
a) portfolio investments;
b) direct investment;
c) export of entrepreneurial capital;
d) export of loan capital.
Answer: c) export of entrepreneurial capital.
Because Entrepreneurial capital is directly or indirectly invested in production and is associated with obtaining a certain amount of rights to receive profit in the form of dividends.
Conclusion
Public and private, entrepreneurial and loan, long-term, medium-term and short-term capital moves between countries. From a practical point of view, the most important is the functional division of capital into direct investments, portfolio investments and other investments, among which international loans and bank deposits play the main role.
The essence of international capital migration is the removal of capital from the country. It is the process of removing part of capital from national circulation in a given country and moving it in commodity or monetary form to another country in order to generate income. And the main reasons for capital migration are: the relative excess of capital in a given country, its overaccumulation, the presence of customs barriers, different marginal productivity of capital determined by the interest rate, the possibility of monopolizing the local market.
Bibliography
1.World economy: Textbook. manual for universities / Ed. I. P. Nikolaeva. - M.: ZAO Finstatinform, 1999. - 286 p.
2.International economic relations: a textbook for university students studying economics / [V. E. Rybalkin and others]; edited by V. E. Rybalkina. - 7th ed., revised. and additional - M.: UNITY-DANA, 2008 - 591 p. - (Series “Golden Fund of Russian Textbooks”).
3. ru.wikipedia.org/wiki/Capital_migration
4. www.economy-global.ru/
5. www.novayagazeta.ru/data/2010/028/02.html
6. www.investor-info.ru/
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Export of capital is the process of removing part of capital from national circulation in a given country and moving it in commodity or monetary form to another country in order to generate income. Since any country in the world not only exports, but also imports capital from abroad, i.e. If so-called cross-investments occur, then we should talk about international capital movements (capital migration).
International capital migration- This is a counter movement of capital between countries, bringing income to their owners. According to modern theories, the main reasons for capital migration are:
Its relative surplus in a given country, overaccumulation of capital;
Different marginal productivity of capital determined by the interest rate. Capital moves from where its productivity is lower to where it is higher;
The presence of customs barriers that prevent the import of goods and thereby push foreign suppliers to import capital to penetrate the market;
The desire of firms to geographically diversify production;
Growing exports of goods, causing demand for capital;
The discrepancy between the demand for national capital and its supply in various spheres and sectors of the country’s economy;
Possibility of monopolizing the local market;
Availability of cheaper raw materials or labor in countries where capital is imported;
Stable political environment and generally favorable investment climate.
Exported (imported) capital can be characterized according to various criteria.
By source of origin moving capital is divided into official, provided by the government of one country to another, as well as the capital of international economic organizations (IMF, World Bank, UN, etc.) and private – funds of non-state firms, banks, etc., moved according to their own decisions.
According to form The export (import) of capital can be carried out in monetary or commodity form. The export of machinery, equipment, patents, know-how as a contribution to the authorized capital of a company being created or purchased constitutes the export of capital to commodity form, and providing, for example, loans or credits to foreign firms or the government is the export of capital to monetary form.
By nature of use capital is divided into entrepreneurial and loan capital.
Entrepreneurial capital- these are funds directly or indirectly invested in any foreign production in order to make a profit. In turn, entrepreneurial capital is divided into direct and portfolio investments.
Direct foreign investment– is an investment of capital with the aim of acquiring long-term economic interest. Direct investments are considered to be those that cover more than 10% of the share capital and give the right to control the enterprise. Direct investments are carried out in the form of capital investments in foreign industrial, commercial and other enterprises by organizing production by the exporter of capital in the territory of another country. Enterprises created abroad can take the form of:
Branch – an enterprise wholly owned by a direct investor;
Subsidiary - an enterprise in which foreign direct investment amounts to more than 50%;
An associated company is an enterprise in which foreign direct investment is less than 50%.
In modern conditions, the bulk of foreign direct investment comes from international corporations. Foreign direct investment is an important feature of an international corporation. Today, the 100 largest transnational corporations (TNCs) account for about a third of all foreign direct investment.
Portfolio foreign investments – This is an investment of capital in foreign securities that does not give the investor the right to real control over the investment objects. Portfolio investments are made by purchasing stocks, bonds, treasury bills, options, futures, warrants, swaps, etc. The purpose of portfolio investment is to generate income through the growth of the market value of securities and paid dividends.
The movement of portfolio investments is significantly influenced by the difference in the yield of securities in different countries, the degree of risk on these investments, and the desire of firms to diversify (diversify) their portfolio of securities with securities of foreign origin.
The advantage of portfolio investments compared to direct ones is that they have higher liquidity, i.e. the ability to quickly convert into currency.
