What is a holding company? What is buying foreign bonds? What is the impact on the country?

Holding company refers to a company that controls a company by holding a certain number of shares. Holding companies are divided into pure holding companies and mixed holding companies according to their holding methods. Pure holding companies do not directly engage in production and operation business, but only carry out capital operation by holding shares of other companies. Hybrid holding companies not only carry out capital operation through holding, but also engage in some production and operation businesses.

The purchase of foreign bonds refers to an investment activity in which an investor purchases the creditor's rights issued by a foreign enterprise or government in international bond markets, obtains the interest income on the debt on schedule, and recovers the principal at maturity. There are two basic types of international creditor's rights, namely foreign bonds and European creditor's rights. The former refers to the creditor's rights issued by the issuer in another country's bond market. Generally, the currency of the country where the market is located is used as the pricing currency, which is underwritten by the restructured domestic securities firms. Most investors are residents of that country. The relevant issuance procedures and application procedures shall be handled in accordance with the relevant provisions of the country where the market is located on securities issuance. European creditor's rights originally refer to the dollar creditor's rights issued in Europe in US dollars. The historical background of this form of international creditor's rights is: on the one hand, it is difficult for foreign borrowers to issue US dollar creditor's rights or obtain US dollar loans in the United States due to restrictive financial measures in the United States; On the other hand, many countries, especially European countries, have large dollar surpluses and need to seek investment opportunities in the bond market. After the 1970s, with the increase of the fluctuation of the exchange rate of the US dollar, the proportion of European creditor's rights denominated in German marks, Swiss francs and Japanese yen gradually increased. At the same time, the distribution place also broke through the geographical restrictions in Europe and began to distribute in Europe, North America and Latin America. Up to now, Eurodollar claims, Euroyen claims and EuroDeutsche Mark claims have occupied the largest proportion in the European bond market. International debt investment has many advantages: from the perspective of investors, it is highly liquid, and the income may exceed the interest of domestic securities or bank deposits. At the same time, through international investment, it is conducive to diversifying investment risks; For creditor practitioners, issuing international creditor's rights can obtain a lot of international funds to develop domestic production and service industry.