Study On Assessment Of Private Investment Environment In West China

Due to such restraining factors as geographic location, infrastructure, economic development level, social, cultural and other factors, for a long time, the economic development in western region mainly relies on state-owned capital investment, but its inherent inefficiency has led to lower economic development level. Nowadays, private capital is becoming the big driving force in promoting economy development, and to encourage private capital invest in the western regions is the enormous challenges faced by different levels of government.In this dissertation, study is based on both domestic and foreign research and practices. The method of empirical analysis and normative analysis are used; after analyzing the characteristics of private investment in the western regions, its regional disparity is calculated. Based on macro-environment, investment behavior and investment motive analysis of private investment, the dissertation constructs environment evaluation index system for the western regions, which includes qualitative and quantitative indexes. Then empirical evaluation and comparison among the western regions for private investment environment are operated. In the end, some suggestions of optimizing private investment environment in West China are put forward.First of all, through reviewing related literature, the dissertation explains the impacts that the investment environment has on the private investment, and establishes the theoretical framework. The results of study on the status, direction, efficiency of private capital investment in the western region show that, with the planned economy gradually withdrawing, and the market economy maturing, total private capital investment in the western regions has been increasing year by year, with private investment in 2007 reaching 385 times of those at the early stage of the reform. After the implementation of the western development strategy, private investment growth in the western regions was slightly higher than the national average and with a relatively stable development, but its private capital share in total private capital is the smallest, which only covers 19.2% in 2007. They are mainly concentrated on less-profitable and the labor-intensive industries and other general competitive industries in West China. In these fields, the proportion of private capital is over 60%, while the state-owned capital is less than 30%. And in these areas, private capital efficiency is much higher than the efficiency of state-owned capital, reflecting stronger competitive capacity.The research on the total size and effect of private investment in the western regions shows that there is a big investment disparity among the western areas and it turns out to be stratified development. This reflects there is a disparity of private investment environment in West China. In competition with each other about how to attract private capital, the fundamental way is to analyze and evaluate its investment environment, and thus target to improve it.The comprehensive analysis of the policy, management, legal, human, economic, infrastructure, resources, harmonious environment for private investment shows that there is a prominent competitive disadvantage in the western regions. The competitive disadvantage is subject to the western region-specific objective and subjective factors. The analysis of these environmental factors is the basis to establish the level indicators for private investment environment evaluation.At the same time, factors affecting the main motive, profitability, and the behavior of private investment are analyzed, because they are the evaluation basis of the secondary and tertiary indicators.After determining the evaluation indicators of all levels for the private investment environment in West China, an evaluation system has been established using quantitative indicators and qualitative indicators respectively. Then the index selection principle, weight for quantitative indicators, assignment method of qualitative indicators are described, namely, entropy method for evaluation of quantitative indicators and the Delphi method for evaluation of qualitative indicators. Based on private investment evaluation index system and evaluation method, an empirical analysis on private investment environment in the western regions was conducted. The results of quantitative indicators show that comprehensive investment environment of Sichuan province is the best, ranking the first. Then it is followed by Shaanxi, Xinjiang, Inner Mongolia, Chongqing, and Guangxi. The places that lag behind are Yunnan, Gansu, Ningxia, Qinghai, Guizhou, and Tibet. If viewed dynamically, Sichuan ranked the same, always maintaining a strong competitive capacity, while Shaanxi rose to the fourth from the second, and Ningxia from the eleventh to the ninth. They both moved two steps forward, indicating that these two regions have greatly improved the investment environment. However, Inner Mongolia, Guizhou, and Xinjiang show a decline. The evaluation results of qualitative indicators show that the gap between the different regions is not very big, and they are all at the lower levels.The purpose of the study is to radically improve the investment environment in the western regions. Based on the analysis of private investment environment, the dissertation puts forward countermeasures for optimizing private investment environment in the western regions, namely, establishing mechanisms to strengthen social functions, providing all kinds of supportive policies, strengthening human resources training, and rationally distributing industrial structure.