Study Of Local Government Behavior In Absorbing Foreign Investment

The introduction of foreign capital in China is closely related to social and economic development. After 30 years of practice, it proved that the reform and opening up is the right way to realize socialist modernization in China, foreign investment is an important driving force to promoting economic development. In the early stages, in the context of shortage of capital, local government is the main role absorbing foreign investment and promoting local economic development. Although government absorbing investment has a certain historical rationality and produces some positive effects, but it is the performance of government functions dislocate and offside. With the acceleration of economic globalization and the further deepening of China's opening up, China's economic ties with the world economy more closely, local government direct absorbing foreign capital will be adversely affect the local economic health and sustainable development. For example, some areas attract foreign investor by preferential policies, result in against the purposes and principles of the country's economic development policies, and will damage the sustainable development of regional economy seriously. It is important for the healthy development of local economy to study these problems, survey an effective way for investment attrbehavior, and make the local government play an active performance of the investment attrbehavior.This paper analyzes the China's historical background of local government attracting foreign investment, local government functions after economic reform and opening up and the introduction of foreign capital status and role; summed up the introduction of local government in foreign investment in the problem:too much government involvement, idea behind etc.; the author gives an analysis of these problems:unreasonable performance evaluation standards and do not play a role of intermediary in the market. On this basis, the author suggests that as the socialist market economic system established and improved,local governments should speed up the transformation of government functions, and gradually fade out the main investment fields, strengthen the environment improvement; nurture the cooperation under the guidance of the investment system, and so on.