China's Food Industry To Attract Foreign Direct Investment Influencing Factors

After Chinese reform and opening to the outside world, a large number of foreign direct investments pours into china in the fields of mechanical,electron,chemical industries and technology-intensive industry. The foreign investors keep the preferential technology as the important means to keep the advantage in the competition, so as to dominate our market gradually. This will exert a far-reaching influence on our economic growth in the future. For this reason, the increasing of the stock of foreign direct investment and its negative effects has caused people's concerns to the national economic security.On the other hand, the growth speed of food industry develops in a great percentage. The total industrial output value of 1999 is 7828 billion, while the total industrial output value of food industry of 2004 reaches to more than 16000 billion. The annual average speed exceeds 15%, which grew into 5 times of original output. However, although the total industrial output value of our food industry developed quickly with more than 10% speed and increased progressively every year. Compare with the world food industry of about 2700 billion dollars output, our country only accounts for the share less than 5%. So the potentiality is enormous. Because of such two current situations, if we can lead foreign direct investment into our food industry actively, then we can not only prevent some industry development from overly relying on foreign direct investment, which will weaken our own control to the industry; but also can further optimize the structure of food industry in conformity with national agriculture, so as to ensure our country's economy develop in a harmony and constant way.So, on the base of former research about the influence factors of foreign direct investments and then combining with the characteristic of present Chinese food industry, I use 1999-2006 relevant data of the three main secondary departments of food industry----Food processing industry, Food manufacturing industry, and Beverage manufacturing industry, with the help of eviews software to carry on a deep research to the factor of our food industry absorb foreign direct investment. Through the analysis of the market scale factor, industry added-value rate, average scale of enterprise, capital intensive degree, labor cost and extent of marketization etc, I try to find out the important influence factor of the food industry, which attracts foreign direct investment. Finally, we can propose countermeasure and suggestion.The result inflects that the market scale, enterprise's average scale and added-value rate of the industry is in the relation of positive correlation with foreign direct investment. Capital intensive degree, the extent of marketization and the labor cost is in the relation of negative correlation.