Research Of The Effect On The Upgrading Of China's Industrial Structure From FDI

In the period of system transition and the stable and rapid economic development time,solving structural problems,promoting the rationalization of industrial structure,improving the effciency of resoure allocation is the focus of Chinese economic development.While the introduction of foreign direct investment is an important measure to promote the upgrading of the industial structure .As the world's second largest host country of foreign direct investment, how to make better use of foreign direct investment to promote the upgrading of China's industrial structure is even more significant.This paper examines the effect of foreign direct investment to the upgrading of China's industrial structure using large amount of data. And on this basis, focusing on analysis of the effect of foreign direct investment on China's domestic industry's structure.Firstly classify China's industy into resource-intensive, labor-intensive, capital-intensive and technology-intensive,and compares the differences of FDI's spillover effect between the labor-intensive industries and the technology-intensive industries,using the datas from 2000 to 2010, to achieve the combination of quantitative and qualitative analysis;Secondly, in width, analyse the direct and indirect impacts of foreign direct investment on China's industrial structure , and compare the effort of foreign direct investment on China's domestic industrial enterprises in the industry spillovers and inter-industry spillovers;Thirdly,not meeting the level of the static structure,this paper examines the sustainability of the effect of foreign direct investment on China's industrial structure,using the effect of foreign direct investment on the independent innovationg capacity of China's domestic industrial enterprises.Provides some useful thinkings for a better use of foreign direct investment by carefully analysis of the reasons of the above results.It is found that foreign direct investment will help China's upgrading of industrial structure both in the three industries and within the industrial. Within the industry,the effect of foreign direct investment on technology-intensive industries is better than on labor-intensive industries .Overall,the effect of foreign direct investment on the independent innovation capacibility of China's domestic enterprises is active. Relative to the industry spillovers, inter-industry spillovers is more conducive to China's domestic-funded enterprises to enhance the capability of independent innovation, and to the continued upgrading of China's industrial structure.the improve of foreign capital's scale, density and the technology ,and the convergence of domestic and foreign can effectively increase the spillover,however the high level of green investment and the single source of the FDI also resticts the spillover.This paper argues that ,on the one side China should furthur improve its policy of FDI,on the other side, R & D investment should be strengthened to improve the technological absorptive capacity, enhance independent innovation capability,balance the use of independent innovation and external technical resources , continuously improve the international competitiveness of China's high-tech products, so as to achieve the purpose of the upgrading of industrail structure.