The international movement of capital, its active migration between countries is an important part and a form of modern international economic relations.
Capital exports broke the monopoly of the export of goods in an era of in-depth development of the world economy. Complementing and mediate export of the goods, he becomes the determining factor in the system of international economic relations. According to estimates by the Organization for Economic Cooperation and Development (OECD) in 80 years (since 1983) the average annual growth rate of direct investment (PI) was approximately 34%, which is almost 4 times higher than the rate of increase in world trade.
The movement of capital is very different from the movement of goods. Foreign trade is usually limited to the exchange of commodities as use-values. The export of capital (foreign investment) is the process of withdrawal of capital from national circulation in the country and moving it in a commodity or cash in the manufacturing process and the treatment of another country. At first, the export of capital was typical for a small number of industrialized countries who export capital to the periphery of the world economy. The development of the world economy significantly expanded the scope of this process: the export of capital is a function of any successful and dynamic economy. Capital and take out the major industrial countries, and middle-income countries, and developing countries, in particular, the "newly industrialized countries". What are the causes of capital flight?
The main reason for the export of capital and the prerequisite is the relative abundance of capital in the country, its over-accumulation. In order to generate business profits or interest he transferred abroad. Characteristically, the export of capital may be in short supply and capital for domestic investment.
By the 90 th year in the world have formed a huge mass of reserve capital seeking profitable use. Insurance companies, pension funds, trust, investment and other funds accumulate the funds. Only in the U.S. of their assets in 1995 exceeded 8 trillion. U.S.
Since the second half of the XX century, the export of capital is continuously growing. The export of capital is ahead in terms of growth as commodity exports and gross domestic product of industrialized countries. With the sharp increase in scale export of capital increases its international migration.
International migration of capital - is a counter-movement of capital between countries, bringing their respective owners income. Many countries are both an importer and exporter of capital: there are the so-called cross-investment.
The main reasons for the export of capital for the sake of greater profits are:
1. The discrepancy between the demand for capital and supply in the various segments of the global economy.
2. The appearance of the absorptive capacity of local commodity markets. In this case, capital is exported in order to pave the way for the export of goods to stimulate demand for its products. To this end, not only mastered the existing markets, but also create new ones.
3. The presence in the countries to which exported capital, cheaper raw materials and labor. So, for example, a German worker in the manufacturing industry is "worth" is 4 times higher than the Taiwanese, 9 times higher than Brazil or Mexico and is 54 times more than the Russian.
4. A stable political environment and a generally favorable investment climate in the host country, preferential investment regime in special (free) economic zones.
5. Lower environmental standards in the host country than in the country - the donor capital.
6. The desire to detour to penetrate the markets of third countries that have established high tariff or non-tariff barriers on products of an international corporation. For example, Israel and South Korea have banned the import of cars from Japan. However, this prohibition does not apply to import cars produced in the branches of Japanese firms operating in the United States.
In practice, the need for investment is determined by a complex of reasons, including all components of the investment climate, as well as the principle of comparative advantage of individual markets.
Factors that contribute to and stimulate the export of capital:
1. The growing interdependence of national economies and cohesion that are the driving force that activates the export of capital. The internationalization of production has a huge impact on the international movement of capital, contributing to its acceleration. The export of capital, especially in the form of equity, is the main factor contributing to the transformation of the international production and the creation of so-called international products. International production - it's products sold in the global international market. It is unified and implemented regardless of geographic, ethnic, or other characteristics (cars, airplanes, electronics, computers, etc.).
2. International industrial cooperation, investment of transnational corporations in the subsidiaries. Thus, the individual legally independent companies from different countries in a single international corporation established close cooperation in the field of industry, technology, specialization exploded. The export of capital provides these links.
3. Economic policies of industrialized countries aimed at attracting large amounts of capital to maintain the pace of economic growth, employment, development of advanced industries.
4. The economic behavior of developing countries seeking to help attract foreign capital to give a significant boost to its economic development, to break out of "the vicious circle of poverty."
5. Important stimulators are international financial organizations, guide and regulate the flow of capital.
6. International agreements on avoidance of double taxation of income and capital between countries contribute to the development of trade, scientific and technological cooperation, attraction of investments.
The subjects of the movement of capital in the world economy and the source of its origin are private businesses, government, international economic and financial organizations.
Movement of capital, its use is in the form of:
- Direct investment in industrial, commercial and other enterprises;
- Portfolio investment (in foreign bonds, stocks and securities);
- The medium-and long-term international loans (or loan) the loan capital industrial and commercial corporations, banks and other financial institutions;
- Economic aid free and in the form of soft loans (interest-free, low-interest).
In world practice, a clear distinction between the movement of capital and foreign investment.
Movement of capital include: payments for transactions with foreign partners, loans (for a period not exceeding 5 years), the purchase of stocks, bonds and other securities of foreign companies solely for the purpose of capital allocation, portfolio diversification, etc.
Under the foreign investment is understood to mean the movement of capital, which seeks to establish control and participation in the management of the company in the host country of the capital.
The direct investments are those investments in the host country, which allow you to participate in the management of the object of attachment.
The main forms of direct investment are: the opening of overseas companies, including the establishment of subsidiaries or branches of discovery, creation of joint ventures on a contract basis, joint development of natural resources; purchase or annexation ("privatization") companies in the country, receiving foreign capital.
Direct investments are the basis of the rule of international corporations in the global market. They provide them with either full ownership of foreign companies, or the possession of such part of the share capital, which provides the actual control of the investor. As a rule, these are investments in which the foreign investor is not less than 25% of the share capital of the company. Statistics of the United States, Germany, Japan, direct investments are those that are at least 10 percent of the share capital and provide an opportunity to control the company. According to P. X. Leendert "the distinction between direct and portfolio (indirect) investment is reduced ... first of all to the problem of control" of the company, which is invested capital.
The distribution of foreign investment by country and industry largely determines the structure of the modern international economy, the relationship between the different parts of the world economy. Leading countries in, the field of direct investment are the major industrialized countries. With approximately four fifths of the annual flow of direct investment, at the same time they are the biggest importers and exporters of capital.
In 1990, the flow of direct investment abroad was a record, surpassing the $ 200 billion ensuing recession was replaced by new growth. The global volume of foreign direct investment in 1995 rose to 315 billion dollars, reaching a total of 2.7 trillion. U.S.
Portfolio investment - it is stocks, bonds, other forms of capital investment, without giving direct control over the activities of the foreign operation. Investors can profit only in accordance with the rules of the Securities Act.
Portfolio investment - an important source of foreign capital to finance bonds issued by major corporations, central (government) and private banks. Intermediaries in the implementation of foreign portfolio investments are the typically large investment banks.
On motion of portfolio investment is significantly affected by the difference in the rate of interest rates paid on the bonds in individual countries.
In the post-war period in the structure of exports of capital have been notable changes, reflecting the characteristics of the development of the world economy. The most important of these is the huge increase in international lending in the 70 - 80 years and the formation of the global credit and finance capital. Dramatically increased the role of the loan capital.
In the 60 years of the international loan market was characterized by short-term operation. In the 70 - 80 years has been a huge growth in the medium and long term loans. Medium-and long-term loans are used to replenish capital, credit and financing transactions for the acquisition of shares, the establishment of branches of foreign construction and reconstruction investments. In the role of the principal borrowers act, above all, international corporations.
In 1995, the international capital markets set a new record in the area of lending. According to the Organization for Economic Cooperation and Development (OECD), the agreement of all types for perpetual and term debt instruments rose to $ 388 billion ($ 258 billion in 1994). The share of syndicated loans in the total amount of funding has reached 29%, becoming the most important international instrument.
In the 80 years has been actively used this form of loan capital as project financing, that is, large loans for specific industrial facilities. In fact, this form is similar to a direct investment.
On the issue of the impact of the export of capital in the form of portfolio investments and loans, it should be noted his dual impact on the world economy. On the one hand, provides the international reproduction of capital. In terms of its internationalization and integration of financial markets increases the efficiency of the mechanism of international economic relations. On the other hand, the uncontrolled flow of capital cause disequilibrium of balance of payments and lead to significant fluctuations in exchange rates. In turn, the significant import of foreign capital can lead to the ousting of the national capital.
The economic assistance provided by the industrialized countries to the rest of the world for free, as well as in the form of soft loans, consider the example of the United States, occupying the second place (after Japan) to assist States in the world.
Thus, in accordance with the "Law on foreign aid," the U.S. fiscal year 1994 earmarked for assistance to 13 billion dollars (76% of the economic and 24% for military purposes). In the first place on the list of recipients of loans - Israel (3 billion dollars), the second - Egypt (2.1 billion dollars). 65% of the aid provided free of charge, 35% - in the form of soft loans.
According to the State Department, the U.S. has provided Russia in the first half of the 90s in the form of non-repayable aid 4.7 billion, dollars, of which $ 2 billion aimed at economic and technical assistance, $ 1.7 billion - on a straight line humanitarian assistance and the purchase of food and $ 1 billion - for the implementation of the program of reducing nuclear weapons in the former Soviet republics. The peak of U.S. aid to Russia was in 1994, when it amounted to $ 1.6 billion