Strategy For Industry Choice Of China's OFDI

In the times when the economic globalization is spreading rapidly and the global industry structure is being rapidly adjusted, every country in the world is actively making use of both domestic and international markets and resources to seek for a higher level of development. As one effect, waves of cross-border investment are continuously penetrating into every corner of our world. Under this background, study on the issues related to OFDI has always been the focus of the attention of government and academic world.As China is on the right key period, in which the growth mode of national economy is changing and the industry structure is upgrading, it is of practical and profound significance through the strategy of industry choice of OFDI to promote the industrial restructuring process and impulse the whole national economy towards continuously, rapidly and healthily development. In particular, the spread of U.S. Wall street storm provides a pretty good opportunity for Chinese enterprises to go abroad. In order to explore deep into the benchmark for the industry choice of OFDI and enhance appeal for relevant policy, and on the basis of China's and Foreign Related Theory and Literature and analysis of the status quo for China's Industry Choice of OFDI, this paper carried out a detailed empirical analysis for the efficiency of China's three main industries, agriculture, manufacturing and service industries, and then three benchmarks for industry choice of OFDI are concluded.Through analyzing the status quo of China's Industry Choice of OFDI, we found the different OFDI proportion of various industries. In this context, Data Envelopment Analysis (DEA) method is used to measure the three industry's efficiency of OFDI against separate GDP and export. The outcome shows that the efficiency of manufacturing OFDI ranks the first, while agriculture and service industry rank the second and third separately. Through analysis on the outcome, we found that it is the different international competitiveness and inappropriate OFDI structure of each industry that lead to the different efficiency. At the same time, this paper summarized three main benchmarks for the industry choice of our OFDI, "Marginal industry benchmark", designed to shift our marginal industry; "homogeneity of industrial structure's degree", suggesting to increase the overseas investment with respect to high-end manufacturing and modern services industry; "resources seeking benchmark", consists of natural resource seeking and agriculture resource seeking benchmark.Focusing on the above empirical and theoretical analysis, this paper proposes the strategies and policies for the rational industry choice of OFDI. Firstly, from the angle of strategy and according to the benchmarks for industry choice of OFDI, some strategies are concluded with respect to some important industries such as service, manufacturing mining and agriculture. Secondly, based on the close relationship between industry choice and location choice, different countries and regions should be treated with different strategies. Thirdly, for the effective implement of the above strategies, some policies and suggestions are proposed from the government, financial institution, industry association and the enterprise itself level.In a word, the industry choice of China's OFDI is performing along with the growing overall scale of OFDI, and the rationality of industry choice relates with the quantity's growth and the quality's improvement.