The Analysis Of Foreign Direct Investment's Influence On Foreign Trade Of China

With the quickening development of the globalization process, theconnection between investment and trade is close increasingly. Foreign DirectInvestment is becoming main strength for influence of trade on increasementbetween various countries. As a whole, the interaction and interrelationbetween international trade and FDI are strengthened day by day. Butparticularly, under the economic globalization, which kind of relation betweenForeign Direct Investment and international trade of one country,complementarity or substitutability? What influence will FDI exert on totalamount, structure and method of the trade? Summarized and analyzed fromtwo respects in terms of the theory and demonstration, it has importantrealistic meanings for further extending and opening Foreign DirectInvestments of our country; these problems are exactly main contents that thisresearch paper studied, too.The thesis includes five parts, the first part is the introduction, mainlyincluding the proposition of the question, study state survey of relevantdocuments and domestic scholars, structure arrangement of this text. Limitedto author degree's strength, this text limits the range of research just in FDIimpact on trade of China.Second part is chapter one of the thesis. This part summarizes overalldevelopment situation of Foreign Direct Investment and foreign trade of China.In this part the author clearly introduces the process of development in foreigntrade and FDI of our country through a large number of materials and datum.It has analyzed the rapid development of foreign trade since the reform andopening in three respects: the rapid growth of foreign trade, imported andexported goods structure's improvement and market pluralism of foreign trade.While expounding the course that our country attracts Foreign DirectInvestments, the author divides the development process of Foreign DirectInvestment into four stages, it separately analyzes the development trait of FDIin recent years from industry distribution, trade structure, area distribute, wayand source of utilizing foreign capitals etc. First FDI distributes in secondaryindustry and concentrates mainly on manufacturing industry, locates mainly incoastal area. Joint venture between Chinese and foreign investment is a maininvestment way, which takes the greatest share of FDI. The proportion of thewholly foreign-owned enterprise rises fast comparatively. At the end of thispart, the author analyzes position advantage of FDI, which developed so rapid,briefly introduces the crossing development trend between FDI andinternational trade.The third part of the thesis has described FDI impact on trade in terms oftheory. Having analyzed substituting and complementary theory of capitalcirculation and commodity trade from two respects between the traditionaltrade theory and new trade theory separately, and briefly ntroducesDengNing'stheory, which integrates and breaks through the above two theory. The trend ofthe international capital's expanding constantly becomes the reason for whichinternational trade grows at top speed. The high growth of international tradehas impelled the further enlargement of the international direct investmentagain. The trend of merging each other has appeared in the development ofinternational capital and international trade.The fourth part of the thesis has analyzed FDI's impact on our country'sforeign trade development from direct and indirect respects separately. Fordirect impact, the author discusses it by expansion at quantity andimprovement at quality. Through demonstration analysis of data of past years,seen from the total amount, since 1994 the proportion of import and export ofFDI rises increasingly among the total import and export value over the years,this fully reflects FDI's important status in Chinese trade at present. By thelook of figure of the contribution rate column, the contributions offoreign-investment enterprise to the exporting increment are greater andgreater; According to improvement on the quality, imported and exportedgoods'structure improves constantly, industrial manufactured goodsproportion raises notably, the structure of export market presents the pluralisticdevelopment trend. In the influence analysis of the foreign trade way, it mainlyanalyzed the impact of the Foreign Direct Investments on processing trade.Under the background of fact that the foreign-investment enterprise becomesmainstay of processing trade of our country progressively, we notice thelimitation exists in partiality for this kind of processing trade offoreign-investment enterprise too, it is of low quality when there is technologyintroduced in processing trade, the appreciation rate of the products is low;Processing trade involves the result badly; It is apt to receive the anti-dumpingtreatment when the processing trade products are exported, such factors aredisadvantageous to export of relevant products of our country. For FDI'sindirect influence on Chinese trade, it has promoted the technological progressof domestic enterprises of our country, promoted the competitiveness ofdomestic enterprises, and the experience of management of domesticenterprises, having improved the laborer's quality. It has produced the effectthat " the market enter and overflow "and increased the possibility thatenterprises of our country enter world market.Based on the above several chapters'analysis, the fifth part forwardssome policy recommendations for improving trade competitiveness of ourcountry. Analyzed from respects: FDI policy, processing trade, industrialstructure which the foreign enterprise invested in, the author proposes somemeasures in order to improve our country foreign trade competitiveness andpromote the development of foreign trade. During the process of abstractingFDI, started from system innovation of macroscopic, microcosmic and so onthree aspects, it is aimed that FDI can fully develop the ability of creatingwealth for China. We should raise scale that FDI introduce and utilizationefficiency from two respects: system innovation and method innovation,promote the technological innovation and system innovation to the maximumextent so that we can promote the growth of China's national industry'scompetitiveness.