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the financing of investments by capitalist enterprises, firms, and companies with internal sources of accumulation, such as retained profits and depreciation deductions. The practice became more common after World War II (1939–45), with the deepening of the general crisis of capitalism, the strengthening of the power of the monopolies, and an increasing degree of exploitation of the working people.

The high level of inflation, the crisis in the capitalist monetary system, and chronic budget deficits in the bourgeois states have undermined the importance of external financing sources such as state funds, credit and finance institutions (banks and insurance companies), nonfinance companies (commercial credit, joint possession of securities), and the public. The monopolies, particularly the largest ones, are creating their own accumulation funds, to provide some degree of protection against fluctuations on the loan capital market. The possibilities for increasing the scale of self-financing were created by the high level of profits, particularly in the highly concentrated and monopolized sectors, as a result of the continuous rise in prices, the growth of the proportion of retained profits, and wage freezes.

The specific causes, the scale, and the direction of self-financing differ depending on the period and the country. Self-financ-ing was most intensively practiced during the early postwar years, when the monetary and credit systems of many capitalist nations had been undermined, the accumulation rate in the private sector was low, and state resources were channeled only into certain industrial sectors, as well as into the infrastructure. In the capitalist countries of Western Europe, the rise in nominal wages generally lagged behind price increases during these years. The state encouraged the withholding of a significant portion of company profits from distribution to shareholders.

In the mid-1960’s the expansion of self-financing slowed down. In a number of countries, it came to a halt. Enterprises began to make more extensive use of external financing sources. In the late 1960’s and early 1970’s there was a tendency to establish a certain equilibrium between self-financing and the mobilization of resources from external sources. The stabilization of the general level of self-financing does not exclude qualitative differences in the financing structure, depending on the type and size of the enterprise. Thus, in France, where the average self-financing rate was 61.6 percent between 1968 and 1972, the proportion of internal funds in the financing of gross investments in fixed capital was 84.4 percent for private enterprises, 57.2 percent for state enterprises, and 93.8 percent for the 400 largest private companies.

In various countries there are considerable fluctuations in the proportion of self-financing in the total capital investments of enterprises. The proportion of self-financing has been rather low in Japan (about 17–20 percent). It has been highest in Great Britain and Canada (up to 70 percent). In the Federal Republic of Germany and the USA, self-financing accounts for approximately 45–65 percent of the. total capital investments.

Small and medium-sized enterprises and companies do not have sufficient funds for self-financing. Moreover, they have limited access to the long-term loan capital market. Consequently, they use short-term bank credits for a significant proportion of their capital investment financing.


References in periodicals archive ?
All non-profit-making education institutions offering full-time locally accredited self-financing sub-degree or bachelor's degree (including top-up degree) programmes are eligible to apply.
specific data for leasing companies: the thresholds they can reach through various attracted financing sources, the euro-lei exchange rate (needed in the case of foreign credit financing), the time frames within which the company gains access to the respective financing sources, as well as the self-financing threshold the company has and that can be used to finance the transaction.
The Task Force on Review of Self-financing Post-secondary Education will consider the overall role and function of the self-financing post-secondary education sector in serving the long term education and manpower needs of Hong Kong; and review major issues of concern pertinent to the ecology of the self-financing sector, including the role of the self-financing operation of subvented institutions vis--vis self-financing post-secondary institutions, and the future development of sub-degree programmes.
The Committee on Self-financing Post-secondary Education (CSPE) today (October 4) released the study results on the level of compliance by the self-financing post-secondary education sector with the Code of Good Practices on Governance and Quality Assurance for Self-financing Post-secondary Education Sector.
attaining "3322" in the Hong Kong Diploma for Secondary Education Examination when they are enrolled in eligible self-financing undergraduate programmes; or
To increase the supply of subsidised undergraduate places by leveraging the supply of the self-financing sector;
The Education Bureau announced today (October 19) a new round of applications for the Quality Enhancement Support Scheme (QESS) under the Self-financing Post-secondary Education Fund.
In conclusion, Pixler commented, "Notwithstanding the self-financing of all of our acquisitions and growth, our company has enjoyed seven consecutive quarters of profitability.
The allocation of the government premises for reprovisioning purposes demonstrates the Government's support for a sustainable and healthy development of the self-financing post-secondary sector and its determination in enhancing the learning environment for students.
Industrial Development Corporation (IDC), a self-financing, national development finance institution in South Africa, and SES ASTRA, the operator of Europe's leading direct-to-home satellite system, have each concluded an investment in IP Direct.
We need urgent action to reset the self-financing settlement, with assurances that its foundations won't be pulled away the moment government attention turns to something else.
The current plan will make the project self-financing, remove the need for equity funding, and provide Crew and its partner, NunaMinerals, with a positive net cash flow years earlier than previously estimated.