Local Governments To Attract Foreign Investment Strategy Research

Since the Reform and Opening up, investment promotion has become an importantfunction of local government. Based on the development achievements, it seems thatthe government-led investment model is valid. It can be said that investmentpromotion has become an important part of local government public administration,and the objectives and implementation of investment promotion cannot be achievedwithout a series of public administration measures, and therefore investmentpromotion is also an indispensable part of scientific research of public administration.In recent years, local governments have been competing with each other in order toattract more investment. They are often over-generous to offer too much incentives,and sometimes, they even ignore state laws, and neglect waste of resources anddeterioration of environment. Better public administration on a higher level isrequired to tackle this issue.Wuxi is located in the developed Yangtze River Delta area. The municipalgovernment issued a series of policies to attract investment, and had some impressiveachievements in the development of open economy. In2008, however, Wuxigovernment weakened its function of government-led investment promotion, whichresulted an obvious lagging behind other cities in the field of foreign investmentutilization. The case of Wuxi is representative.The article begins with discussion about functions of government publicadministration. Then it discusses the theoretical basis and contents of the localgovernment's function in investment promotion, analyses the relationship betweeninvestment promotion and local government functions based on the demand ofdevelopment and current trend, and defines the roles and responsibility of localgovernment in investment promotion. The article continues the analysis of the current status of China's local governments tofulfill their investment promotion functions. It describes the main problems faced bylocal governments in investment promotion in China, including government issues,economic issues, and social issues.The article moves to analyze the basic experience of the investment promotionfunction in Singapore government. and highlight that the transformation ofgovernment functions is the key to the success of investment promotion andgovernments should change their ways of management in accordance with thechanges of international trends. It then compares Wuxi with other leading cities in theYangtze River Delta, analyzes the current domestic and international environment andits impact to investment promotion in China, and points out that local governmentshave to adjust government functions and management philosophies to adapt to thechanges.It concludes that government still plays a dominant role in investment promotion atthis stage. But it can gradually introduce more market-driven measures, and optimizethe investment promotion strategies in areas of model selection, strategic planning,policy making, regulation implementation, and etc. It takes Wuxi City as an exampleto illustrate a series of measures and initiatives which are possible to beimplemented in terms of organization, policy, regulation, security, and provide areference for local governments to improve their functions of investment promotion.