A Study On American Direct Investment In China (1980-2000)

A major reason for the study on American direct investment in China is that there have been increasing interactive economic activities between the countries world wide. Since World War II, especially since the 1960's, chiefly due to multi-national corporations, the international transfer of production capital has replaced currency as the major form of capital export, and has become the major form of the movement of international capital. International direct investment is increasingly becoming the most important and effective means of financing, and is playing an increasingly important role in world economy.The first Sino-American corporation was established in 1980. After thirty years of interruption in the economic relationship, American capital returned to the mainland of China. Based on the related economic theories, the present paper makes an analysis on various causes of it, and concludes that the American direct investment in China resulted from a combination of various inevitable and potential factors. Ever since, despite occasional setbacks, the investment has witnessed a continual development, and has experienced three phases: starting, steady development, and rapid development. The features of American direct investment in China are also analyzed from the perspective of the scale, form, regional distribution of the investment, and the distribution of industries. With 1990 as the dividing line, specific analysis is made on the factors that led to America's increase in its direct investment in China during the two periods. On the basis of the favorable facts such as China's joining WTO, continual perfection of her investment environment, etc., the paper concludes that American direct investment in China will witness a more rapid development in the new century and will ultimately become the major form of interactive activities between the two countries.