Chinese Foreign Direct Investment Effects On Economic Growth: The Case Of Belt And Road Countries

In 2013,Chinese President Xi Jinping proposed a cooperative initiative to build “Silk Road Economic Belt” and the “21st Century Maritime Silk Road” in Kazakhstan and received positive responses from many countries.On May 14-15,2017,Beijing hosted the first “One Belt,One Road” Summit Forum On 25-27 April2019,Beijing hosted the second “Belt and Road Forum for International Cooperation”,which was attended by 37 foreign heads of state and government and representatives from more than 150 countries and 90 international organizations.This level of participation and interest indicates the increasing attractiveness of the initiative.The “Belt and Road Initiative”(BRI)enables participating countries to achieve mutual benefit and win-win results.For example,foreign direct investment has a certain impact on the economic growth of countries along the BRI.The research in this doctoral dissertation focuses on the impact of China's foreign direct investment on the economic growth of the BRI countries.This doctoral dissertation has eight chapters.The first chapter is an introduction,which mainly introduces the basics,purpose and significance of this study on BRI.At the same time,it introduces research methods and innovations into the content of the study.The second chapter defines the basic concepts and existing related theories and literature review on this topic.Key concepts include BRI,foreign direct investment,and economic growth.The third chapter is the application of theoretical Marxist thoughts theory on this study.It includes the basic theory of Marxism,the impact of foreign direct investment on economic growth,and also defines the framework for the study of this work.The fourth chapter,based on logic thinking of empirical research on relevant data of 64 countries,there is an overview of outward foreign direct investment in China,economic structure and economic growth of the BRI countries and its investment climate and attractiveness.Chapter five and chapter six are empirical studies.The results show that the influence of Chinese foreign direct investment on the economic growth of the host country is very complex.Without considering the influence of foreign direct investment on the domestic capital investment,all foreign investment as a resource input can solve the problem of insufficient capital and promote the economic development.However,foreign direct investment may also crowd out domestic investment.Many investors just use their capital advantages to squeeze the profit space of the original host country,exacerbating the bankruptcy risk of local enterprises in the host country,and making no obvious contribution to the upgrade of manufacturing industry and economic growth.After further adding the technical proxy variables of a country,we find that all the foreign direct investment has negligible and insignificant influence on the economic growth of the host country after comprehensive factors.In addition,another focus of empirical analysis is the impact of China's foreign direct investment on countries along the BRI.Our empirical analysis results show that China's foreign direct investment has a significant role in promoting the economic growth of host countries along the BRI route.The biggest difference between China's foreign direct investment and other foreign direct investment is that a large part of FDI is used to provide infrastructure for developing countries along the BRI,which is also the main reason why Chinese foreign investment and all foreign investment have different impacts on the economic growth of BRI host countries.Most of the countries along the BRI are developing countries,and the lack of infrastructure construction is an important factor hindering the economic growth of developing countries.Infrastructure construction is an important area of China's direct investment in countries along the BRI,which is conducive to promoting the development of local economy and regional economic connectivity.Chapter 7 is giving a case of Kazakhstan and the impact of Chinese FDI on the economic growth,which is indicates a positive correlation as well.Chapter 8 is conclusion and some recommendations.The main contribution of this dissertation is to explore the influence and role of Chinese foreign direct investment on the economic growth of destination countries from the perspective of the countries along the BRI and explore the world influence and significance of BRI.In addition,this doctoral dissertation also collects relevant data and uses the individual fixed-effects model to deeply analyze the effects of China's foreign direct investment on the economic growth of countries along the route and has carried out sub-sample regression according to the income groups of various countries.The conclusions are thought-provoking and have certain innovative significance.This dissertation examines the effects of Chinese foreign direct investment on the economic growth of countries along the BRI and considers several determinants of economic growth in the region – capital accumulation,labor conditions and technological innovation.Through a gradual return,the complex relationship between foreign direct investment,capital,labor,technology and economic growth is analyzed in more detail.Research on this topic has led to a better understanding of the BRI and shows that China's investment in countries along the BRI has made outstanding contributions to local and regional economic growth.The deficiency of this dissertation is that,due to the limited number of empirical studies,only a rough comparative analysis of the sample data at the national level is carried out,insufficient to conduct more detailed economic research at the medium and micro levels.As for the future research on the impact of Chinese foreign direct investment on national economies – study on the indirect socioeconomic impact and empirical test of this level is suggested.