Study On The Impact Of FDI To Chinese Steel Industry International Competitiveness

Industrial international competitiveness is one of the most popular questions concerned by academia, the business community, and the governments. As the linkage between the corporate and national competitiveness, the Industrial international competitiveness's effective upgrade is the foundation to enhance a given national competitiveness. With the growing penetration of FDI, the steel industrial, which is one of our country's basic industries, has been greatly benefited from the FDI and its competitiveness has been enhanced. In all these progress, the impact of FDI on industrial international competitiveness is catching more and more attention and presenting some significant problems, such as what does the FDI can do to the steel industrial international competitiveness of our country? Facing the surging of FDI, what should we do in order to make use of the advantages while keep out of the disadvantages?Based on Michael Porter's"diamond"theory, choosing the steel industry as representatives,this paper analyzed the mechanism and channels of FDI's influences on the sources of industrial international competitiveness—the four key elements and the one exterior factor of the"diamond", to make research on effects and to bring forward some suggestions about how to improve international competitiveness of Chinese steel industry by taking use of FDI.As for domestic requirements, FDI promotes the market growth, increases the requirements of steel products; the effects of FDI on production elements include that FDI accelerates the capital accumulation, promotes the HR exploitation and technology advancement; the pulling-up effects on the supporting industries and the diffusion effects on the related industries are the main influences of FDI on the related and supporting industries; In the fields of firm strategy and market competition, FDI enhance the domestic competition; finally, FDI impacts the government through enhancing the interaction between government and the four key elements.In the part of quantitative analysis, the paper analyzed steel industrial international competitiveness and the influences of FDI on the steel industrial international competitiveness. The results showed that China is not a powerful country in steel industry and FDI effected the Chinese steel industry positively.In order to increase Chinese steel industrial international competitiveness, the paper made suggestions from terms of local companies and Chinese government. The firms should consolidate and enlarge channels of absorbing spillover-effects of foreign firms and cultivate the capability of research independently. Meanwhile, the government should implement the active policy of attracting foreign capitals oriented by advanced technologies and maintain a fair competition environment.