International Direct Investment And China's Industrial Structure Upgrade Analysis

Foreign Direct Investment(FDI)act as a more and more vital role in world economics development. With the reform and open policy, China has attracted more and more FDI in recent years. In 2005, China attracts FDI more than 60.325 billion US dollars .FDI becomes the important impelling force to promote China economy grows .It not only has affected the China economic output growth, but also has influence to China's industrial structure and the market mechanism.FDI has promoted China industrial structure in the last 20 years through industrial effect and technical proliferation, as well as technical proliferation. The whole influence of FDI is to promote China's industrialization advancement, promote China's technology-intensive industry development. FDI also promote three industrial interior structures which were obviously can be seen from the industry. The main influence is to promote technology-intensive industry development, lead industrial enterprise's new product development and the design capacity.At the same time we must see FDI also has the certain negative influence to China's industrial structure. For instance, FDI has enlarged the Chinese three industries proportions unreasonable condition .During the attraction of foreign capital process does not pay great attention to the actual impetus effect to the industrial structure. Lacks the essential protection to the national mainstay enterprise and so on.This paper discuss from the policy angle to find the way to avoid negative influence to China industry structure. These kind of polices conclude industrial, tax, revenue and regional policies. In addition, our government must continue to strengthen the market competition and government supervising and managing.