As you know, international relations in the field of economics have many forms, and it is incorrect to interpret them solely as relations of the sale of goods during which they cross state borders. Specialists identify from three to eight forms of international economic relations, and the international movement of capital is one of the most important forms of international economic cooperation. We will talk more about him in this article.
The international movement of capital (MDK) is an objective economic process. The reason for this movement is the difference between capital returns in different countries. In essence, capital is the same resource as the rest, but its price is not expressed in monetary terms, but in the percentage of return that its investment can bring. Thus, in developed countries, sooner or later, an amount of capital accumulates at which interest rates no longer satisfy its owners. In this case, they begin to look towards less developed countries, in whose markets there is a significant shortage of this resource, which means that the return on investment will be significantly higher.
The main forms of international capital flows:
1) export of entrepreneurial capital. It is carried out in the form of portfolio (portfolio) or direct (direct) investments abroad. The fundamental difference between these types of investments is that direct investments are aimed at obtaining the right to manage the enterprise, while portfolio investments are aimed only at receiving dividends or with the aim of playing on the difference in stock prices;
2) export of borrowed capital. It is similar to the export of entrepreneurial capital, but with the only difference that in this case all the principles of the loan are observed: paid use of borrowed resources (in the form of interest rates), urgency, repayment of the principal amount and the availability of collateral or surety;
3) international economic assistance. It is a free transfer of financial resources, material wealth or forgiveness of borrowers' debts (London is responsible for private debt and Paris lenders club for public debt).
It is worth noting that any country acts as an exporter and importer of capital. Russia in the international movement of capital is no exception. So, many companies invest in the creation of new industries in the territory of their country (car manufacturers investing money in the creation of their own factories in the Russian Federation can serve as a vivid example). At the same time, our residents also invest in other countries (for example, Gazprom, which develops its infrastructure in countries through which transit flows pass).
The international movement of capital is not just the transfer of financial and other resources between different countries. This is a powerful automatic regulator, thanks to which the levels of economic development of countries are aligned, and this regulator is activated by nothing more than the situation on the capital markets of a given state. The international capital movement allows countries with a lower level of development to find investors who will be ready to invest in projects with greater risk (due to political instability, an imperfect legal system, and lack of experience in investing in this state), but also with greater profitability. Thanks to this process, it becomes possible to create new jobs and production capacities, the population is provided with necessary goods, and the state budget is provided with taxes in the form of created enterprises.
