1. The present situation of capital flight in China
Capital flight, also known as capital flight and illegal transfer of capital, is an abnormal cross-border flow of funds. Since 1990s, there has been a serious phenomenon of capital flight in China. Some analysis shows that China has become the fourth largest capital flight country in the world after Venezuela, Mexico and Argentina, and the proportion of capital flight in GDP is only smaller than that of Russia. According to the Financial Times, China has become a capital exporter in the world. Only a small part of the structure of export capital belongs to foreign direct investment and securities investment approved by the government, and the rest belongs to various forms of capital flight. Because of the illegality and concealment of capital flight, it is difficult to accurately measure its scale. Recent research results show that since the 1990s, China's capital flight has shown an overall upward trend of about $654.38+0000 billion, forming three categories: 654.38+0992, 654.38+0994-654.38+0995, 654.38+0997-654.38+0998 respectively. During the period of 15, the total capital flight of China was 153 1000 billion US dollars, with an average annual 102 billion US dollars.
(1) Capital flight from current account
The current account includes goods and services, income and current transfers. Commodity account is an important channel for capital flight. On the one hand, the parties underreport foreign exchange income from trade, keep foreign exchange abroad without authorization in violation of state regulations, or simply conceal foreign exchange income from trade activities; On the other hand, it exaggerates the foreign exchange expenditure of trade and fraudulently buys foreign exchange from the designated foreign exchange bank of the state and remits it abroad. There are other forms of "false invoicing" like this. It is worth noting that some contents of "import and export misrepresentation", such as the false import value caused by forged documents, will be reflected in the item of "mistakes and omissions", but the false import value, including capital flight caused by over-reporting imports and under-reporting exports, is not reflected in the balance of payments.
Services include transportation, tourism, communication, construction, insurance, financial services, exclusive use fees and franchise fees for computer and information services, various commercial services, personal cultural and entertainment services and government services. Units and individuals can escape from capital through service projects. For example, units can purchase foreign exchange from banks or spend money from their foreign exchange accounts in the name of various external payments to realize capital flight, and individuals can also purchase foreign exchange for private purposes. For frequent travelers, the accumulated amount of cash carried legally or illegally for many times is also large.
Income items include employee salaries and investment income, among which investment income has a large space for capital flight, and the parties generally realize the purpose of capital flight by underreporting foreign investment income and overstating investment income paid to foreign investment. Regular transfer is also a channel for individuals to escape from funds. Due to the loosening of relevant policies in China, the limit of individual overseas remittance has been expanded from $2,000 to $20,000, so the capital fleeing through this channel will increase rapidly.
(2) Capital flight through capital and financial projects
Capital and financial projects include capital projects and financial projects, among which financial projects are an important channel for capital flight. Financial projects include direct investment, securities investment and other investments. Two small projects of direct investment, "Foreign Direct Investment in China" and "Foreign Direct Investment in China", are often used by capital flight manipulators. The asset categories of securities investment projects are worthy of attention, and the borrowers and lenders of asset categories reflect the increase and decrease of non-resident securities assets held by China respectively. This project has increased rapidly since 1997, and the deficit has expanded year by year, indicating that the outflow of domestic capital through securities investment has risen rapidly (see table 2). Other investment projects record all financial transactions except direct investment and securities investment. They are the biggest changes in capital and financial accounts in recent years, and have become one of the important channels of capital flight in China.
(3) Capital flight through the underground banking system
As an informal way of transferring funds, underground money houses are widely used all over the world, especially in some international illegal and criminal activities. There are many underground banks in Jiangsu and Zhejiang provinces in China, with fixed locations, fixed customers and stable sources of funds. In recent years, the amount of funds flowing out of underground banks in China is amazing. It is reported that China transfers 200 billion yuan (about 24.4 billion US dollars) through underground banks every year, which is 2% of 201year GDP, equivalent to the annual foreign trade surplus of 25.5 billion US dollars. Underground money houses are often regarded as the most important way of money laundering by smugglers, corrupt people and drug criminals because of their high confidentiality, no record and anonymity.
2. The characteristics of China's capital flight
(1) Capital flight is transitional.
Capital flight can be divided into real capital flight and transitional capital flight according to its nature. Authentic capital flight is a one-way transfer of capital from one country to another because of fear, suspicion or in order to escape the abnormal risk or control of one country; Transitional capital flight is the capital flight caused by the transfer of capital from one country to another in order to escape various controls and obtain higher relative income, and the latter returns to the capital outflow country as an investment.
Yang (200 1) and others confirmed the positive correlation between capital flight and foreign direct investment in China, indicating that China's capital flight is mainly caused by the differential policy treatment between domestic capital and foreign capital, rather than the deterioration of the investment environment (Note: Yang: Empirical analysis of the relationship between capital flight and foreign direct investment in China: 1984 ~ 65438). Li Xiaofeng (2000) pointed out that "asymmetric risk" factors, that is, asymmetric information obtained by domestic and foreign investors or asymmetric economic and political risks, will lead to a large inflow of foreign capital and increasing capital flight (Note: Li Xiaofeng: Theory and Reality of China's Capital Flight, Managing the World, April 2000). This can be confirmed by the source structure of foreign investment in China. Tian Xiaoxia (2000) believes that among the domestic risk factors that stimulate China's capital flight, the "arbitrage space" formed by the government's differential treatment policy for domestic and foreign investment is one of the important factors.
(2) Transnational money laundering is an important part of capital flight.
With the economic growth of China, the number of "black money" of corrupt elements, drug crimes, smuggling crimes and organized crimes of underworld nature has risen rapidly. In order to escape the blow, in recent years, a large amount of "black money" has flowed out of China. A group of corrupt public officials and smuggling criminals can not only squander these illegal gains openly, but also put on the legal cloak of illegal money through various channels to invest and re-increase their value. Money laundering in China is mostly carried out across borders through underground banks. It is estimated that among the 200 billion yuan laundered through underground banks in Chinese mainland every year, the smuggling income is about 70 billion yuan, and the official corruption income is more than 30 billion yuan.
Second, the impact of China's capital flight.
1. The impact of capital flight on China's domestic economy
(1) influences capital formation
Economist Rostow asserted in his famous Theory of Stages of Economic Growth that the necessary condition for economic take-off is that the proportion of net investment in national income increases to more than 10%, and the growth of net investment must be conditional on the accumulation of social capital. In the famous "Harold-Thomas model" formula G=S/K, when the output rate is constant, the capital accumulation rate S becomes the only factor that determines a country's economic growth rate G. So capital flight will weaken the stamina of a country's economic development. At present, China's economic development is still in the stage of attracting investment, and a large number of capital flight will undoubtedly slow down the economic development.
(2) weakening the government tax base
Large-scale capital flight will inevitably erode a country's tax base. In recent years, China's huge capital flight, especially "transitional" capital flight, enjoys tax preference as "foreign capital" return, on the one hand, it makes the tax that the state should collect lose and reduces fiscal revenue; On the other hand, it has also created a number of fake foreign-funded enterprises and formed an unfair competitive environment.
(3) lead to the loss of wealth
As a developing country, a considerable part of China's capital flight flows to developed countries such as the United States and Britain in one direction. A report of 200 1 1 Xinhua News Agency pointed out: "According to incomplete statistics, there are currently more than 4,000 suspects of corruption and bribery at large. Among them, some people have fled the country ... ". Most of the corrupt officials who fled abroad squandered huge illegal gains abroad, resulting in a large loss of domestic wealth.
2. The impact of capital flight on China's open economy
(1) affecting international credit rating
Capital flight will aggravate China's dependence on foreign capital, and the large increase of foreign capital and foreign debt will undoubtedly challenge China's international debt paying ability. Although China has a large amount of foreign exchange reserves, if capital flight continues and occurs on a large scale, it will inevitably affect the debt repayment rate and lead to the international community's credit evaluation of China. At the same time, capital flight also reflects the lack of confidence of domestic and foreign investors in China's economic and social prospects, which hinders our government from applying for additional foreign loans and affects international capital. During the period of severe capital flight, Moody's Investors Service and Standard & Poor's Company, two major international risk assessment agencies, rated China as BBB[+] and BBB respectively. Therefore, the negative impact of large-scale capital flight cannot be underestimated.
(2) affect the balance of payments
A country's balance of payments mainly depends on the balance between capital account and current account. With the expansion of international capital flows, the proportion of capital projects will continue to rise, while the proportion of current projects will decline. In the short term, large-scale capital flight, especially sudden capital flight, will worsen China's capital account, reduce foreign exchange reserves, further aggravate the imbalance of international payments and trigger a larger capital flight. Capital flight will also have a negative impact on China's current account. From the perspective of trade balance, capital flight devalues the local currency exchange rate. According to the "J curve" effect, China's trade balance has a deficit first, and then a surplus; From the perspective of non-trade balance, there may be a persistent deficit. Long-term and sustained capital flight will eventually destroy China's balance of payments and worsen China's foreign economic environment.
(3) Affect the stability of RMB exchange rate
As far as the foreign exchange market is concerned, capital flight reduces foreign exchange supply on the one hand and increases foreign exchange demand on the other. Under the floating exchange rate system, the local currency exchange rate will fall rapidly. In countries with fixed exchange rates or managed floating exchange rates, the central bank will use foreign exchange reserves to maintain a certain exchange rate level, so it will quickly reduce the national foreign exchange reserves. Therefore, capital flight is an important factor that impacts China's foreign exchange market and intensifies the pressure of RMB depreciation.
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3. The influence of capital flight on social stability and national security in China.
(1) aggravated the loss of state-owned assets.
The phenomenon of "owner absence" in China's state-owned enterprises gives the managers of state-owned enterprises considerable rights to control state-owned assets. In the absence of effective supervision, the economization of administrative power is easy to happen. Capital flight of state-owned enterprises is an important form of continuous loss of state-owned assets in the absence of effective supervision.
(2) Contribute to various money laundering crimes.
If capital flight, especially transnational money laundering, succeeds, the economic strength of all kinds of criminals will be enhanced, the desire to commit further crimes will be stimulated, and the possibility of further crimes will be greatly increased, forming a vicious circle. In this context, the arrogance of criminals such as smuggling, drug trafficking and underworld will become more arrogant, and the crime of money laundering will further expand, which will seriously corrupt the social atmosphere and affect social stability.
(3) damage the ruling foundation
Because many of the funds fleeing from China are the illegal gains of some power classes and people who are inextricably linked with them, the flight is just to escape the blow. Therefore, once the capital flight is successful, its corruption will be difficult to verify, which will make it escape punishment, have a bad impact on society and damage the prestige of the party and the government. If this continues, it will fundamentally damage the ruling foundation of the ruling party.
Third, address both the symptoms and root causes to effectively curb China's capital flight.
1. Curb capital flight from the source.
(1) Maintain a stable political and economic situation and retain domestic and foreign capital with a good investment environment.
A stable political and economic environment is not only the prerequisite for China's steady economic development, but also the primary condition for attracting foreign investment, and it is also the top priority for China to prevent capital flight from the source. Relevant state departments should implement prudent fiscal and monetary policies, maintain the stability of currency circulation and value, and create a safe and reliable investment environment for domestic and foreign capital. The state should not only increase investment in energy, transportation, communication and municipal public facilities, but also governments at all levels should actively improve the conditions in intangible areas, such as maintaining the continuity of policies, improving the legal system, simplifying means and reducing intervention.
(2) unify the different treatment of domestic and foreign capital, and eliminate the "differential rent" and "policy gap" between domestic and foreign capital.
A large part of China's capital flight belongs to "transitional" capital flight, and its main purpose is to realize the transformation of capital identity through capital flight, that is, from domestic capital to foreign capital, so as to enjoy various policy advantages provided by our government. The existence of this "policy gap" and "differential rent" undoubtedly contributed to the capital flight of China. International experience shows that tax incentives are not particularly attractive to multinational companies that pay attention to global interests and implement long-term investment strategies. For example, the United States has no "super national treatment" for foreign investment, but it has always been the country that attracts the most foreign investment in the world. Therefore, China should abolish the "super-national treatment" enjoyed by foreign investors in corporate income tax, customs duties, industrial and commercial taxes, foreign exchange management, industrial policies and even market access, and replace it with an attractive market, an efficient and sound management mechanism and a superior investment environment, so that domestic and foreign investors can compete fairly under equal treatment. This can basically put an end to the phenomenon of "circuitous investment".
(3) Protect private property rights and realize equal treatment between different ownership economies.
First of all, we should vigorously publicize the relevant provisions of the Constitution on the protection of private property, so that private legal property can be protected by law as well as public property. Secondly, in practice, we should improve the protection of private property rights, emphasize the continuity and consistency of protecting private property, and dispel the doubts that a few rich people are "afraid of revealing their wealth" and seek "safe haven" abroad. Third, realize the equal treatment of enterprises with different ownership, ensure the equal competition of private enterprises under the market economy, and realize the optimal allocation of resources under the guidance of market mechanism.
(4) Promote the reform of state-owned enterprises and solve the problem of state-owned assets from public to private from the mechanism.
The establishment of SASAC has laid a solid foundation for the reform of state-owned enterprises and the management of state-owned assets. SASAC should deepen the reform of state-owned enterprises from the following aspects, improve the governance structure of state-owned enterprises and put an end to the capital flight of state-owned enterprises. First, earnestly fulfill the responsibilities of investors, be the "owner" of state-owned enterprises, and completely eliminate the phenomenon of "absence of owners"; Second, establish independent directors, enrich the board of directors and strengthen the internal constraints of the board of directors on the general manager; Third, through strict laws and regulations and fair social intermediary institutions such as auditing and accounting, the legitimacy and transparency of state-owned enterprise management will be improved and the external constraints on state-owned enterprise operators will be strengthened; Fourth, promote the property right reform of state-owned enterprises, realize the diversification of property rights forms, introduce social individual shareholders, and mobilize the enthusiasm of different owners to supervise the operators of state-owned holding enterprises; Fifth, cultivate the manager market of state-owned enterprises, so as to facilitate the managers of state-owned enterprises to survive the fittest.
2. Blocking the path of capital flight
(1) Establish an anti-money laundering joint financial supervision network to block transnational money laundering channels.
The network of anti-money laundering supervision organizations should cover financial, judicial and customs departments. In order to improve the efficiency of anti-money laundering work, it is suggested to establish an anti-money laundering financial supervision institution in a mixed mode, that is, an "anti-money laundering financial supervision group" composed of China Banking Regulatory Commission, China Insurance Regulatory Commission and Securities Industry Association. At the same time, combating money laundering is a systematic project, which requires coordination and cooperation from all walks of life. Therefore, China should improve the joint financial supervision network including the financial system, the judiciary, the tax authorities, the customs and the Ministry of Finance. That is, on the basis of anti-money laundering financial supervision group, in order to strengthen cooperation with relevant domestic institutions, it is suggested to set up a permanent institution-joint meeting group under the joint meeting system; In view of the internationalization of money laundering activities, the Anti-Money Laundering Outreach Group was established to strengthen cooperation with international anti-money laundering organizations.
According to international experience, China should also establish an anti-money laundering financial intelligence group, whose tentacles should be spread all over major financial institutions in China, such as commercial banks. Its main task is to collect data and information, report large cash transactions and suspicious financial transactions to the anti-money laundering financial supervision group, and report suspected crimes to public security organs and other organs in a timely manner.
(2) The State Administration of Foreign Exchange shoulders the heavy responsibility of controlling capital flight.
At present, China should take measures to eliminate the current situation of multi-head management as soon as possible, and make it clear that the State Administration of Foreign Exchange is the responsible department for managing foreign exchange funds throughout the country. As a freely convertible currency under the current account, RMB can only be purchased and paid by the parties with real transaction vouchers if there is an international transaction and it must be a real transaction under the current account. A large number of capital flight is carried out in the form of fake imports. The foreign exchange administration department should strictly examine the authenticity of the customs declaration unit for import payment of foreign exchange, write off the customs declaration unit that exceeds a certain limit (for example, US$ 200,000 or US$ 654.38+10,000) for the second or even third time, and notify the relevant departments to severely investigate and deal with fraudulent units and corrupt elements who fled through the unit.
Foreign exchange management departments should strictly control the transfer of income and expenditure under RMB current account to prevent capital flight under non-trade items such as education fees and travel expenses paid by individuals. Special attention should be paid to supervising the external payment behavior of leading cadres and heads of large and medium-sized state-owned enterprises with certain administrative levels (such as director level), reviewing the legality and rationality of their transfer of income and expenditure, and establishing a sound external payment record. If the parties can't prove that their sources of funds are legitimate, they will suspend the handling, thus providing conditions for the relevant departments to find out the facts. It is necessary to strictly implement the current foreign exchange management regulations. When domestic residents withdraw foreign currency cash equivalent to more than USD 6,543,800+from their cash accounts at one time, banks must examine their true identity certificates, register them one by one according to the number and amount of transactions, and regularly file with the foreign exchange bureau; When withdrawing foreign currency cash equivalent to USD 654.38+USD 00,000 but less than USD 50,000 from the cash account at one time, the bank shall review the relevant certification materials and register for the record; One-time withdrawal of foreign currency cash equivalent to more than 50,000 US dollars must be approved by the foreign exchange bureau. If the foreign exchange income remitted from abroad does not enter the personal account but directly withdraws foreign currency cash, it should also be supervised in accordance with the corresponding foreign exchange management regulations. Commercial banks should report to the foreign exchange bureau in a timely manner when they find any abnormality in the withdrawal of cash by individual residents. Relatively speaking, although it is difficult for the foreign exchange administration department to effectively control the funds flowing out in the name of dividends from foreign investment, it can still be tracked dynamically. The state has formulated a method for reporting international balance of payments statistics. If this method can be implemented through the State Administration of Foreign Exchange and other departments, a considerable part of the fleeing funds will be exposed to the "sunshine" and the attempt to flee will be difficult to succeed.
(3) Public security, procuratorial, legal, customs and other departments should strengthen coordination and cooperation to plug loopholes.
As law enforcement departments, public security organs, procuratorial organs and lawyers should improve their awareness and sensitivity to the serious harm of capital flight, and improve their anti-money laundering and anti-capital flight capabilities and professional quality. It is necessary to find clues from frequent international capital flows, pay special attention to leading cadres whose children or other immediate family members are studying, working or running companies abroad, strictly examine the sources of funds remitted abroad, take effective measures, intensify efforts to crack down on illegal capital flight, find and deal with them together, insist on blocking illegal funds at home and reduce losses to a minimum. At the same time, the public security, procuratorial and legal departments should intensify the crackdown on a large number of underground banks in the southeast coast of China, severely punish the ringleaders quickly, and cut off the black channel of capital flight in China.
Customs should shoulder the important responsibility of preventing a few corrupt elements from leaving the country with illegal income. It is understood that the customs in many places in China are lax in inspecting passengers carrying funds out of the country, and a few corrupt elements bring out huge illegal income through bank drafts from time to time. To this end, the customs should focus on reducing capital flight, acquire necessary equipment, adjust staffing, and strengthen the front-line inspection force, not only to do a good job in document inspection, but also to do a good job in baggage inspection of outbound passengers; It is necessary to strictly implement the existing regulations. Domestic residents who carry more than $2,000 out of the country need to apply to the bank for a foreign exchange carrying certificate, and the customs will examine and release them on the basis of the carrying certificate; Generally speaking, it is not allowed to bring foreign currency cash above $65,438+$00,000 out of the country. If necessary, it must be audited by the foreign exchange bureau and released by the customs with the certificate of carrying.
(4) Actively carry out international cooperation to combat transnational money laundering and capital flight.
The large-scale and continuous deepening of global anti-money laundering actions has undoubtedly created a good international environment for China to fight transnational money laundering and capital flight. To strengthen international cooperation in this field, first, at the government level, our government should show courage and determination, formulate relevant policies and crack down severely; Secondly, at the legislative and judicial levels, relevant domestic laws and regulations should be revised according to international conventions and strictly enforced; Third, in finance, especially at the bank level, the task of the banking sector is even more arduous because criminals and criminal groups mostly launder money and flee funds through banks. At the end of 2000, 65,438+065,438+0 world-renowned big banks announced the long-awaited "Fort Worth Standard" in Zurich, Switzerland, in order to "establish a global standard to crack down on banks' deposit of stolen money" (Note: Lan Jun: the cancer of money laundering is shocking, China Business News, 2006,5438+0. This is the first anti-money laundering industry standard in the global banking industry. China's banking industry has not yet acceded to such an international convention. So far. The Ministry of Public Security of China and the People's Bank of China have always been members of the Steering Group of the Anti-Money Laundering Project of the Eurasian Conference, but China has not yet joined the Financial Action Task Force (FATF), a global anti-money laundering organization. In view of the complexity and arduousness of anti-transnational money laundering and anti-capital flight, participating in international cooperation as soon as possible is very beneficial to the reputation and long-term interests of China's banking industry. Of course, an agreement is not enough. The key is that banks "manage their own children (branches)", and it is most important to actively resist the temptation of profiteering. Only by doing this, banks will not become "accomplices" to promote transnational money laundering and capital flight, thus curbing the rising trend of capital flight criminal activities.