Non-equity investment methods of multinational corporations include

First of all, let's discuss what we usually think of as equity investment, which means that enterprises (or individuals) buy shares of other enterprises (listed and unlisted companies) or directly invest in other units with physical assets such as monetary funds and intangible assets. Its ultimate goal is to obtain greater economic benefits. Secondly, let's look at international direct investment. International direct investment is a concept corresponding to international indirect investment, which refers to the investment activities of directly setting up enterprises or companies abroad in order to obtain long-term investment benefits and have the control and management rights of the company. Thirdly, let's look at non-equity investment, which has been widely used since the 1970s. Mainly refers to multinational companies that do not participate in the shares of the host company, but participate through technologies that are not directly related to equity. Non-equity arrangement is mainly a flexible measure adopted by multinational corporations in the face of the nationalization policy and the gradual withdrawal policy of foreign capital in developing countries, and it is also an important means for them to continue to maintain their position in developing countries. There are many forms of non-equity investment, and the specific forms are constantly developing, among which the most common forms are: licensing contract, management contract, turn-key contract, product sharing contract, technical cooperation contract, economic cooperation and so on. (1) License contract: A technology is transferred to a host country enterprise at a certain price, and the remuneration for the transfer of this technology is paid in the form of royalties, that is, the cost is increased according to the proportion stipulated in the agreement within a certain period of time. (2) Management contract: also known as operation contract and management contract. This is also a kind of technology transfer. It can be divided into two categories: overall management and technical management. (3) turn-key contract: The multinational company is responsible for the whole project, including providing necessary technology and expertise from design, construction and installation, providing complete sets of equipment and facilities, building the factory, delivering all facilities and starting the factory. (4) Product sharing contract: the host country and multinational companies share the products of the enterprise on the basis of the pre-agreed distribution plan, and all the equipment purchased by foreign companies will eventually be owned by the host country after a certain period of time. (5) Technical cooperation contracts: important contracts. Multinational companies do not provide any capital, do not enjoy the ownership and purchase rights of products, and do not assume the responsibility of sales. They provide various technical services in all aspects of the project. The host country enjoys full autonomy, and the technical personnel provided by multinational companies work under the supervision of the host country in exchange for special expenses. (6) Economic cooperation: also known as industrial cooperation, developed on the basis of the so-called East-West industrial cooperation between multinational corporations and the former Soviet Union and eastern European countries. To sum up, we can see that international investment is actually a direct investment to set up a factory in another country, while non-equity investment is a cooperation with another enterprise and does not involve ownership.