Risk Analysis of Enterprises’ Investment in Infrastructure in Developing Countries Based on Structural Equation Model

Abstract

In order to control the risks of Chinese enterprises in infrastructure investment in developing countries, the corresponding evaluation system is constructed through a structural equation model algorithm to analyze these risks, so as to achieve risk prediction and risk controllability. Structural equation modeling is a method to establish, estimate, and test causality. It can replace multiple regression, path analysis, factor analysis, covariance analysis, and other methods and clearly analyze the effect of individual indicators on the population and the interrelationship between individual indicators. It is a multivariate statistical modeling technology mainly applied to confirmatory model analysis. Due to the guidance of national policies, there are more and more opportunities for Chinese enterprises to invest abroad. However, due to the influence of political, economic, and environmental factors, overseas investment is facing many difficulties. This paper analyzes the risks from four aspects: bilateral policy risk, legal difference and litigation risk, international economic risk, and technical risk through structural equation model algorithm. Aiming at these risks, the simulation software of the algorithm is constructed in MATLAB big data analysis software, and the risk control measures are put forward. Finally, with the support of China’s policies, in order to ensure the investment income, we should carry out risk intervention for the foreseeable risk and reduce the impact of risk on the investment income as much as possible, so as to improve the risk prevention and management awareness of overseas investment business. By analyzing the characteristics of venture capital and the various kinds of risks affecting venture capital, the risk structure model estimation of risk sneak attack is established by using the principle of structural equation model, and the impact of various risks on investment risks can be analyzed, so that the risk measurement and control of venture capital provides the basis of theoretical knowledge.