The Context Of The Financial Crisis, Fdi On Jiangsu, Zhejiang And Shanghai Manufacturing Industry Association Effect

Since the 90s of the 20th century, Manufacture Industry in Jiangsu, Zhejiang and Shangha attract foreign investment ranked by the nation. These province are highly economic dependence on foreign investment. These province need foreign investment in the process of changing economic model an upgrading industry stucturethe and economic development .Shanghai's "Pudong model," Jiangsu "Sunan model" Zhejiang "Wenzhou model" three models have in common places in using foreign capital, but also have their own different characteristics. In this paper, we analyze the effect on Jiangsu, Zhejiang and Shanghai's Manufacturing Industry from foreign direct investment on the basis of financial crisis,on the basis of actual conditions and characteristics in these provinces.Theory of multinational corporations overseas investments mainly about three theories, the resources decision theory, transaction cost theory, bargaining theory. Combining the three theories of resources ,this paper explain the the positive and negative effect of FDI. The positive reason is the local natural resources advantage of FDI associated with the advantage of host country industry promote the development of productivity, both partners benefit. The negative reason is that FDI is in a strong position and enable the host country gain.The effect of FDI on the host industry include forward and backward linkages. Backward linkages is that FDI purchase from the host industry, directly attributable to the demand for the upstream industry. FDI establish backward linkages through the management of the upstream industry knowledge, technology, human overflow. Jiangsu, Zhejiang three different modes of manufacturing industry, industrial structure is different from the characteristics of the analysis of the industry, market structure, export orientation, industry capital intensity, industry chain length varies. This structure of the market, the export ratio, capital-intensive industries, the industrial chain of different length of these factors analysis and empirical test, proof of the Manufacturing FDI on the Jiangsu, Zhejiang and their Industrial Relations to study the correlation effects summed up the three features. First, FDI in manufacturing industries is associated with high and low level of double-edged sword. Second, the technology gap and the impact of FDI on innovation is an important factor in foreign direct investment. Third, the proportion of foreign-invested enterprises exported three moderately favorable economic stability, sustainable development.Financial crisis, multinational corporations are affected cash flow, investment in China further delay the process; the other hand multinational companies in the U.S. market, sales have also been blocked. Reflected on the Jiangsu, Zhejiang and associated effects on the manufacturing industry, multinational companies on the technical advantages of being little affected by the great advantage in the export channel for the impact of investment in different sectors slowing down and withdrew to different degrees. After the financial crisis, FDI in manufacturing industry, the three pairs of Jiangsu, Zhejiang and correlation effects occurring changes reflected in the Jiangsu and Shanghai manufacturing TNCs in the capital to Chuyutanpan dominance Gai Bian, Fu to the effect of the host country reduced or disappeared ; embodied in Shanghai, Zhejiang, two manufacturing exports, foreign direct investment in the production of natural resources has brought the possibility of expanding the boundary effects disappear, leading to the formation of a positive spillover effect, therefore reducing or disappearing; reflected in a dominant position in the Manufacturing Industry multinational corporations, investment after the financial crisis slow cost reduction strategy, on the upstream sector into a positive spillover effect of a negative effect.This study concluded that the Jiangsu, Zhejiang and the Manufacturing differentiated selectively into different sectors of foreign direct investment, local industry squeezed too much living space to minimize the introduction of foreign investment; introduction of proportion of exports of foreign direct investment in appropriate ; with local industry, the industry technology gap is too large a selective introduction of foreign investment.