ABSTRACT
This paper analyzes the rule, whereby foreign direct investors, usually operating through joint ventures (JVs) with Chinese partners, are expected to be self-sufficient in foreign exchange (for short, “forex”). In other words, their outlays in hard currencies for the importation of machinery, components, raw materials, and other inputs, for the payment of interest or licensing fees, the remittance of dividends or the repatriation of capital, must be offset by forex receipts out of their venture.
