Empirical Research On The Influencing Factors Of China's Outward Foreign Direct Investment

With the global economic development and large-scale transnational production and operating activities proceeding in developed countries, developing countries also begin to go abroad at the same time. Outward foreign direct investment in developing countries gradually becomes research object of the multitudinous scholars. As the largest developing countries, China has a rapid economic growth, and in recent years its GDP growth rate has been maintained at about 10%. The rapid economic development has promoted the development of China's outward foreign direct investment. Currently, more and more Chinese enterprises begin transnational actions, the flows size increases from 9.2 billion USD in 2000 to 535 billion U.S. dollars in 2009, more than forty times increasing. China's foreign investments are response to the international situations, and are important measures to improve corporations' competitiveness. OFDI (Outward foreign direct investment) is also the major initiatives to solve our foreign trade issues, domestic enterprises' development problems and other issues. But our country's foreign investments also have some problems. Compared to Western countries, China's foreign investment starts late and is low-skilled. Only to find out what influencing factors existing, China's enterprises can be targeted in foreign direct investment activities to achieve better development.The article discusses from the home country angel of our foreign direct investment, and analyses the influencing factors of our foreign direct investment through integrating the studies of both domestic and international scholars. By analyzing the 1985-2009 data of China and through the combination of the quantitative and qualitative analysis, the theoretical and empirical analysis unified, this article discussed the factors of economy situation, trade conditions, market, exchange rate, R&D and other factors to impact on OFDI. The selection of the variable introduces China's average profit margin creatively; in the research methods we uses principal component analysis, co-integration test and the stepwise regression as the main research method. After a factor analysis and empirical test, with combination with initial theory research results, we draw the following conclusions:GDP growth rate, export share of trade, savings rate, wage growth rate and national policies play positive roles in China's foreign direct investments; and the introduction of foreign investment and growth rate of foreign exchange reserves have negative influences to China's foreign investment. Chapter 6 gives some advices on how to promote the further development of our foreign direct investment, mainly including Enterprises' location choice in their investment; improvement of scientific research and technical levels as well as national policy support, etc.