This
paper discusses the risks and benefits that are associated with
foreign investment. The
author uses China as an example to illustrate how foreign investment, particularly American, would affect both the financial and political make-up of the
country. The author makes several arguments in favor of this type of investment including the size of the Chinese market and the fact that, since the early 1990s, the Chinese
government has been making a concerted effort to lure foreign investors to the country. The paper concludes with a discussion of the areas where China can still improve its practices, in order to become more attractive to the foreign investor.