| Since modern times,the Indochina Peninsula subregion has not only suffered from a series of external shocks,but also faced a series of internal problems.As a result,the Indochina Peninsula subregion has been in a state of political and security turmoil and lagging economic and social development.The end of the Cold War marked the stabilization of the political and security situation in the subregion,and peace and development became the main theme of the subregion.In the mid-1980 s,the wind of economic development and reform swept across the Indochina Peninsula subregion.Putting the Indochina Peninsula subregion,especially the transition economies on the fast track to growth.In this process,the impact and mechanism of large-scale ODA inflows on the economic growth of the Indochina Peninsula subregion has received considerable attention.Therefore,this paper mainly focuses on the two main questions “Does ODA helps the economic growth of the Indochina Peninsula subregion?” and“The impact and transmission mechanism of ODA on FDI in the Indochina Peninsula subregion?”.A series of methods such as theoretical analysis,historical analysis,and empirical analysis was carried out,and found the following two main conclusions: On the one hand,based on theoretical research,this paper finds that in the economic growth theory,ODA and FDI impacts on the economic growth of the host country in the form of foreign capital inflow.Among them,as a component of foreign capital,ODA affects economic growth through the accumulation of physical capital within the analytical framework of the Harrod-Domar growth model.Solow and Swan believe that as a special type of foreign capital,ODA is different from FDI in that it is profit-seeking.ODA is mainly invested in the public sector,and when foreign aid funds enter the investment sector,it can effectively promote the total output of recipient countries.Under the combined effect of the above two aspects,ODA is theoretically believed to contribute to the economic growth of recipient countries.The empirical testing results show that the estimated coefficient of the core explanatory variable indicates that the impact of ODA on the economic growth of recipient countries in the Indochina Peninsula subregion countries are negative.There is a significant inverted U-shaped relationship between ODA and economic growth.While compare to multilateral ODA,the impact of bilateral ODA on the economic growth of recipient countries in the Indochina Peninsula subregion are more negative.Regarding the country differences in the economic growth effects of ODA,this paper finds that ODA in Vietnam and Thailand may have a significant positive effect on economic growth compared with Cambodia,Laos,and Vietnam,and the ODA in CLM countries may be hardly forester the economic growth.In addition,based on the mediation effect model,this paper also conducts an empirical test on the mechanism of ODA affecting the economic growth of the Indochina Peninsula subregion.The results show that,at the overall level of the Indochina Peninsula subregion,the empirical test results cannot support the hypothesis that ODA affects subregional economic growth through FDI.After excluding Cambodia,Laos,and Myanmar from the sample countries,the results tend to support the theoretical hypothesis proposed in this paper,especially after excluding Laos from the sample countries,there is a partial mediation effect of FDI between ODA and the economic growth of the four countries in the Indochina Peninsula subregion(excluding Laos).On the other hand,in response to the second major question discussed in this paper,this paper is based on the Solow model at the theoretical level,if only considering the ODA in form of physical capital that inflow in the production sector,the inflow of ODA into recipient countries will have a corresponding crowding-out effect on FDI.A part of ODA invested in complementary factors of production includes social infrastructure and services or economic infrastructure and service sectors can improve the development level of the recipient countries in terms of infrastructure and human resources,which in turn helps to improve the total factor productivity of the recipient countries and stimulate the inflow of FDI.The ODA which is invested in physical capital mainly affects the physical capital accumulation of the recipient countries and does not affect total factor productivity.On the other hand,as for the infrastructure effect of ODA,according to the eclectic theory of international production,multi-dimensional factors that affect FDI in the host country,as one of the specific location advantages of the host country that affects the inflow of FDI,infrastructure plays a role in multinational corporation’ direct investment decisions by reducing costs,expanding markets and improving human capital.Based on the theoretical discussion of the impact of ODA on FDI,the empirical results show that ODA has a significant positive impact on the scale of FDI in the Indochina Peninsula subregion.In addition,this paper further examines the heterogeneity of the impact of different sources and types of ODA on FDI.First,within the Indochina Peninsula subregion,the governance capacity in terms of quality of regulatory,voice and accountability are considered to be important factors affecting the effect of ODA on FDI.Second,the ODA invested in complementary production factor has a promoting effect on FDI in the Indochina Peninsula countries,and There is a significant inverted Ushaped relationship between ODA invested in complementary production factor and FDI.However,the ODA invested in physical capital may be unfavorable for recipient countries to expand the scale of FDI.Third,compared with multilateral ODA,bilateral ODA is more conducive to expanding the scale of FDI in the Indochina Peninsula subregion.Because the donor country can receive more internal information from the recipient country through ODA,and thus provides a channel for domestic enterprises in donor countries to make a systematic and comprehensive assessment before conducting direct investment activities in the recipient country.According to the empirical results of the infrastructure channel in the transmission mechanism of ODA affecting FDI,ODA has significantly improved the infrastructure conditions of countries in the Indochina Peninsula subregion,including land transportation,electricity,communications,and network infrastructure,and the improved infrastructure level has increased FDI flows in the Indochina Peninsula subregion.Based on the above conclusions and the status quo of ODA in the Indochina Peninsula subregion,the last parts mainly focus on policy recommendations on giving full play to the economic growth effect of ODA in the Indochina Peninsula subregion.Firstly,focusing on improving the effectiveness of ODA in the Indochina Peninsula subregion,this paper suggests that governments in the Indochina Peninsula subregion countries should fully mobilize the enthusiasm of donors and expand the scale of ODA.And donors should actively explore new ideas for ODA with recipient countries in the Indochina Peninsula subregion,improve the marginal contribution of ODA to economic growth,and steadily advance the shift from pursuing huge quantity ODA to high-quality ODA.Secondly,promote sub-regional development cooperation to give full play to the effects of ODA on infrastructure.This paper proposes that firstly,the infrastructure effect of ODA should be fully utilized to enhance the attractiveness of the Indochina Peninsula subregion to FDI.Secondly,attach importance to the building of comprehensive governance capacity and making effective use of ODA.Thirdly,strengthen coordination and cooperation among donors to improve the vitality of ODA.Finally,China and the Indochina Peninsula subregion countries are friendly neighbors separated only by a strip of water.In the future,the two sides should continue to promote development and cooperation and strive to build a Neighborhood Community with a Shared Future. |
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