Economic Effect Analysis Of Utilization Of Foreign Direct Investment In Shanxi Province

For a regional economy, openness to the outside world is an important factor for the economic development level. While Foreign Direct Investment (FDI) is the most important indicator to reflect the degree of openness. Over the past 30 years, FDI has played a powerful role in promoting the overall economic development in Shanxi Province. However, different people are holding different understanding on how to scientifically evaluate the economic effects of the utilization of the FDI in Shanxi Province, what has become an urgent problems to solve. This paper attempts to provide an important reference for the utilization of the FDI in Shanxi Province by using the theoretical models of FDI to conduct a more comprehensive and systematic analysis on economic effects, problems and deficiencies of utilization of FDI in Shanxi Province. The research projects have important theoretical and universal practical significance.Firstly, this article introduces the relevant theories of FDI which summary and analyze the relevant theories and academic research of scholars at home and abroad. Then, the article describes the developments and situations of the utilization of the FDI in Shanxi Province, by what it analyzes and demonstrates the economic effect of the utilization of the FDI in Shanxi Province about GDP growth, upgrading of the industrial structure, foreign trade and technological spillover effects by using large amounts of data and building mathematical models. Finally, a number of policy measures about how to enhance the utilization of FDI in Shanxi Province have been proposed after summarizing deficiencies and problems about the utilization of the FDI in Shanxi Province.According to the calculated results of the model, the main conclusions and recommendations are given:Foreign-invested enterprises have played a certain role in promoting to the growth of GDP in Shanxi Province; The contribution of FDI to the secondary industry is larger than the primary industry and tertiary industry, which is conducive to the transformation of industrial structure to the secondary industry in Shanxi Province; There is a clear complementarity between the utilization of FDI and the Foreign Trade in Shanxi Province; There is a certain degree of constraints in technological spillover effects of the utilization of the FDI in Shanxi Province. Therefore, the Shanxi Province should lay stress on equality on the national and foreign capital, accelerate the pace of upgrading of the industrial structure, speed up the transformation of government functions, create a highly competitive market environment, introduce some industries with strong associations and implemente the technological innovation in future.