Analysis On The Impact Of US Direct Investment On Sino-US Exports And Imports

The theory of foreign direct investment and international trade is always being focused by academia. Earlier, the two theories had only developed along their direction. However, after Mundell proposed that investment and trade can mutually replace each other, the scholars have former their own opinions to the relationship of investment and trade, especially the articles about how foreign direct investment influences international trade are in the majority. Since our reform and opening to the world, Sino-US cooperation and communications in trade has constantly developed, and US direct investment has also continually been growing. According to US Department of Commerce, the actually utilized American capital in China totally reached US$272.54 billion from 1989 to 2009, and the total value of Sino-US exports and imports amounted to 365.87 billion in 2009. How is relevance of US direct investment to Sino-US trade, and how dose US direct investment affects Sino-US trade? For this purpose, this paper combines US direct investment with Sino-US trade, comprehensively analyzing effects of US direct investment on Sino-US trade.Firstly, this paper introduces the background and significance of selecting the topic, the research methods and tools, and the research contents and structure. Then, on the one side, the thesis reviews the theories of the impact of foreign direct investment on trade which include the relationship between foreign direct investment and trade is one of mutual replacement, coexistence and uncertainty. On the other side, the thesis describes the research of domestic and international scholars, which is evaluated in this paper.Secondly, this paper adopts a lot of data and charts to objectively describe the situation of US direct investment and Sino-US trade in detail, and analyzes the both correlation and the trade effect of US direct investment. Then this paper analyzes empirically on the level of total quantity and industrial structure. On the total quantity level, this paper implements co-integration tests ECM models to analyze the exports and imports effect of US direct investment on long-term and short-term. On the industrial structure level, this paper divides Sino-US trade commodities into 8 types: the food, the chemical, the metallurgy, the mechanism, the computer and electrical the equipment products, electrical equipment, device and part, the transportation facility, and other goods including suitcase, clothes, textile, wood, furniture and so on). Then, this paper makes an empirical analysis on how US direct investment influences Sino-US trade based on Panel Data model.Thirdly, On the basis of summarizing the arguments of this paper and on the premise that US direct investment can stimulate Sino-US trade, this paper proposes suggestions as followings:properly guide which industry American enterprise flows to optimize Sino-US trade structure; dialectically regard the US investment in China, and adjust the policy to use U.S. investment; improve technical content of foreign investment and promote competitiveness of our country enterprise through technology spillover effect and competition effect; encourage Chinese enterprise to invest in foreign country and reduce trade surplus with the United States.