sumsang

sumsang

While the many aspects may have impacts on the entry and the operation of the Zopa in China, the policy and the political system as the key factor influencing the society and the economy should be taken into consideration first.
Under the socialism political system, China has carried out the mixed economies which recommends both market and command economies with the state intervention and the market mechanisms. The purposes of this economic system are, on the one hand to increase the possibility of economic stability, on the other hand, to stimulate the growth of economy. Foreign Direct Investment (FDI), particularly, is one of the main approaches to achieve the rapid growth of the economy and stimulate the entrepreneurship. 30% of Chinese industrial output and 22% of industrial profits is on account of FDI in 2010 (The World Bank, 2010). Additionally, the profit brought by the FDI still grows recent years. According to the Trading Economics (2015), the volume of trade of FDI in China has increased to 949 USD Hundred Million in the first nine months of this year. This tendency indicate that Zopa, as a foreign invested company, may have considerable potential in the Chinese market. China, meanwhile, implements variable policy and strategies to attract the foreign investors (Chen, 2011). For example, “a 50% concession on payable income tax for foreigners working in foreign-financed enterprises” or “any overseas income exempt from income tax for foreigners based in China for more than one year” (Yeung, 2001, p 70). There are also many other policy besides these can benefit the financed firm like Zopa. For instance, in order to meet the operational requirements of foreign investors, the Chinese government also improve the domestic infrastructure and provide them with the funding and the technology (Huang, 1998). As for the Zopa, it might gain the authoritative credit information rather than the informal credit information. It is important for a foreign credit...