French Foreign Direct Investment And The Sino-french Trade Relations Between The Empirical Research

As the two most important forms of international economic activities, Foreign Direct Investment (FDI) and International Trade are connected with each other more and more closely. For a long time, the debates on the real relationship of them have been being the hot topic in economics circles .Most researchers agree on the idea that the difference in many factors like motivation of FDI , market structure of host country and so on will affect the relationship of FDI and trade a lot . Today the scale of trade and FDI in china become larger and larger, so doing researches on their relationship is very necessary for FDI and trade policy making.This thesis analyzes the relationship between the inward FDI form French and the trade between china and France .First of all, from France starting direct investment to China, it recalled the French direct investment in China'development process, summed up the size of their investment characteristics, industry characteristics and regional distribution. Then it described the course of development of Sino-French bilateral trade, import and export commodity structure and the status of the Sino-French trade imbalance to combine graphic manner in detail. Based on the French direct investment in China and the Sino-French trade relations, as well as the correlation analysis of Sino-French trade of a comparative analysis of multiple models, application of cointegration analysis, Granger causality test and impulse response function based on VAR model analysis of dynamic econometric techniques, empirically studying French direct investment in China and the Sino-French trade, and found that French direct investment in China and the Sino-French trade (including import, export and import and export volume) does exist between the long-term equilibrium relationship. Further analysis revealed that French direct investment in China and the Sino-French trade between complementary relationship; through the Granger causality test found that French direct investment in China and China's imports of French one-way direct causal relationship exist. Through the impulse response function and variance decomposition found French direct investment in China on Sino-French trade exist obvious hysteresis, France's direct investment in China on China's French exports will have a negative impact.but the negative impact will turn into the positive effects. French direct investment in China on China's impact on French imports of French direct investment in China on China's imports of French growth and the import and export volume growth has been relatively stable will maintain a posture. Finally, based on the comprehensive analysis of this paper, there are some relevant proposals.This study will provides a reference for continuing to expand economic and trade cooperation between China and France, to take appropriate means and measures to guide the French enterprises to invest in China and to strengthen law and the rational use of capital introduction, but there are also some shortcomings, such as didn't further to the research of subdivision industry and so on, it needs to be perfected in the further research.