FORMATION OF FOREIGN INVESTMENT SYSTEMS: CHINESE AND UKRAINIAN EXPERIENCE
Abstract
The classification of foreign investment systems is an integral part of the theoretical foundations of the investment process. The development of investment processes in the context of international cooperation requires a properly organized investment system, the effective functioning of which is achieved by satisfying the interests of both investors and recipients. These theoretical developments subsequently form the basis of the legislative framework in the form of regulatory documents and legislative acts governing the foreign investment process. Foreign investments are divided into three categories: foreign direct investment, foreign portfolio investment, and other categories of foreign investment. An examination of foreign investment instruments within the context of Ukrainian-Chinese cooperation makes it possible to streamline the process of attracting investment from the most financially capable participants, which currently is China. Ukraine needs to attract significant volumes of foreign investment for a number of objective reasons; however, this should not lead to a loss of sovereignty in the future. When considering foreign investment from China, which offers attractive terms and principles of parity, it is essential to ensure the rational use of the attracted investments and to prevent any potential abuse or mismanagement of the resources involved. A statesmanlike mindset and accountability for the legality of the host country’s actions will help avoid destructive consequences in the process of foreign investment. When attracting investment, it is important to take into account both national interests and the investor’s intentions and plans. Only on a balanced basis can we embark on a promising path of investment cooperation. The recommendations provided regarding the use of foreign investment instruments in the context of Ukrainian-Chinese cooperation offer insight into the specifics of the investment process. Emphasis is placed on a responsible approach when selecting investment instruments, especially when the responsibility for the investments received falls on the state - that is, when they are backed by state guarantees. Large-scale investment projects must be accompanied by a well-founded strategic plan for implementing such investments.
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