Study On Chineses Outward Direct Investment & Industrial Transfer

The paper studies the cross-border industrial transfer caused by outward direct investment. First we analyze the correlation of industrial structure with outward direct investment of U.S.A, Hongkong, Singapore and China with regression methodology. Then, we make a prediction about the scale of Chinese outward direct investment and relative change of its industrial setup. Finally, we study the comprehensive competitiveness of 28 sub-sectors of Chinese manufacturing sector with the factor method to test which sectors will likely transfer the manufacturing of products cross the border.The results show that the ratio of manufacturing sector in U.S.A, Hongkong, Singapore and China are all negatively significantly related with outward direct investment, which indicate the change of the ratio of manufacturing sector will cause the outward direct investment flow.We predict that in the next twenty years, Chinese annual outward direct investment will exceed ten billion US$ and the ratio of manufacturing sector will decline. So it is important to make relative industrial restructuring policies to choose right leading sectors, support infant industries and help declining sectors. The results of comprehensive competitiveness of Chinese 28 manufacturing sub-sectors show that textile industry, ordinary machinery manufacturing, special purposes equipment manufacturing, chemical fibers manufacturing and instruments, meters, cultural and official machinery are declining, medical and pharmaceutical products, garments and other fiber products, leather, furs, down and related products sectors are becoming more competitive, but still declining. So the paper suggests these sectors should transfer the manufacturing of its low- and mid-end products, keep the manufacturing of its high-end products, encourage technologic innovation and upgrade its R&D...