Research On China’s Outward Foreign Direct Investment In Japan

China and Japan, as the representatives of a developing and a developedcountry in Asia, occupy pivotal positions in Asia even in the whole world economy.Against the background of economic globalization and regional economicintegration, research on China’s OFDI in Japan has significant strategic meaning ofthe further development of bilateral economic and trade relations, building NortheastAsia economic integration and development of global economy.The dissertation, which contains nine chapters, builds a framework oftheoretical and empirical research on China’s OFDI in Japan.Chapter1is introduction. This chapter introduces the background and thetheoretical and practical significance of the topic. On the basis of reviewing relatedliteratures, it builds the research framework and research methods, puts forwardinnovation and shortness of this dissertation.Chapter2is the comments on related theories. The theories of OFDI fordeveloping countries interpret OFDI activities of them from different angles, andoffer certain guidance for them, too. Some of the theories can offer directlytheoretical guide for China’s OFDI in Japan, and some of them can be looked on asreferences for China’s small and medium-sized enterprises.Chapter3is the overview of the development and the status quo of China’sOFDI in Japan. Since1979, China’s OFDI in Japan has experienced more than30years. From1979to the end of20thcentury, China’s OFDI in Japan always wanderedlow level and was very limited in investment scale, number of investment items andthe industrial distribution. Since entered into21stcentury, China’s OFDI grew rapidly,especially focused on the countries in Asia, meanwhile China’s OFDI in Japan hasalso got increasing development and presented a momentum of fast growth. At present, the characteristics of China’s OFDI in Japan include that investment scaleincreases quickly, green field investment is the main investment mode, investmentindustry focuses on non-manufacturing industry, investment position improvesgradually.Chapter4analyzes the motives and comparative advantages of China’s OFDI inJapan. The motive of international investment has been always the focus of academia,scholars from home and abroad put forward all kinds of theories in order to interpretthe motives. Based on reducing, analyzing and integrating the related research fromthose scholars, combined with the real national situation in two nations, the motivesof China’s OFDI in Japan put forward in this dissertation include that to enlargeoversea market and steer clear of trade barriers, obtain advanced technologies andexperiences of management, merge into globalization strategy, strategic promotionfrom the two nations’ governments, etc.. While the advantages of China’s OFDI inJapan are the scale and financial advantage of government leading enterprises,innovation assets advantage of market leading enterprises, social network advantageand geo-culture advantage, and so on.Chapter5formulates economic effects of China’s OFDI in Japan. They includethe effects on volume of Sino-Japan bilateral trade, upgrade of China’s industrialstructure and technical progress. The respective conclusions of the empiricalanalyses show that (1) there is a remarkable co-integration relation between China’sOFDI in Japan and the bilateral trade, China’s OFDI in Japan can promote thedevelopment of bilateral trade, but the former is not the granger cause of the latter,and by the contrary, the latter is the granger cause of the former;(2) there is aremarkable co-integration relation between China’s OFDI in Japan and thecontribution rate of tertiary industries, and long-term equilibrium relation existsbetween China’s OFDI in Japan and upgrade of China’s industrial structure, China’sOFDI in Japan can promote the upgrade of China’s industrial structure and contribute to sustainable development of national economy;(3) there is a remarkableco-integration and long-term equilibrium relation between China’s OFDI in Japanand China’s technical progress, China’s OFDI in Japan can promote China’stechnical progress, the effects of it will be stronger and stronger as the enlargementof China’s OFDI in Japan.Chapter6is the strategic selection of China’s OFDI subject in Japan. Based onSWOT analysis, when China’s enterprises invest to Japan, they have many ownadvantages and weakness. The advantages include such as diversification of the typeof enterprise, lager scale, stronger financial ability and owning innovation assets; theweaknesses include such as weaker comprehensive strength, inexperiencedinternational management, short of internationalized talents and lacking overseadeveloping strategy; at the same time, the opportunities include the policy support ofgovernment, services provided by institutions for investment promotion, lawguarantee offered by investment agreement and chances derived from financial crisis;the threatens include higher operational cost, fewer preferences and more financialdifficulties, more legal restrictions and be vulnerable to political thwart. In the shortrun, China’s enterprises should seize historical opportunity and avoid rationally allkinds of threatens, take use of their own advantages actively to invest in Japan; in thelong run, China’s enterprises should overcome their own weakness, createcomparative advantages, so as to carry out OFDI better in Japan.Chapter7is the strategic selection of China’s OFDI industry in Japan. Chinashould follow the criteria mentioned below: highly homogeneous industrial structure,the radiation effect of related industries, promoting autonomous innovation andJapan’s policy of absorbing foreign investment. As for OFDI in Japan, the secondaryindustry should be the key industry, encouraging the investment of tertiary industry.In the secondary industry, China should strengthen the mature industry which owncomparative advantages, support the high-tech industry to carry out learning-oriented OFDI and actively guide emerging services in the tertiary industry to invest in Japan.Chapter8is the strategic selection of China’s OFDI mode in Japan. China’sOFDI mode in Japan will be affected by not only some factors of the enterpriseitself—the experience in Japan, enterprise size, advantage of technology andmanagement and talents for exploiting Japan’s market—but also Japan’s attitude toattract investment, institutional environment and cultural indifference in two nations.On the basis of the analyses above, China’s OFDI mode in Japan should selecttransnational merger and acquisition as the main entry mode and select joint ventureas the main share hold participation mode. At the same time, China’s enterprises canalso attempt innovative OFDI modes, such as building transnational strategic allianceand industrial park.Chapter9is the conclusion and prospect. This part concludes the mainviewpoints and looks forward to the direction of further research.China’s OFDI in Japan belongs to inverse OFDI, domestic study on the inverseFDI is still at the exploratory stage, there is rare systematic research on China’s OFDIin Japan. This dissertation has somewhat innovation in research perspective, datacompilation and viewpoint reducing. While the dissertation does not carry outhorizontal and longitudinal comparison with China’s OFDI in some Euramericandeveloped countries or some other developing countries’(especially emergingindustrialized countries’ and regions’) OFDI in Japan, which will be researchedfurther in the near future.