An Empirical Study Of Effects Of FDI On Chinese Environment Pollution

Since reform and opening up, China has gradually become one of the countriesmost attracted to foreign direct investment (FDI).At the end of the last century Chinabecome the second largest FDI country after the United States and NO.1amongdeveloping countries in attracting FDI. Since the reform and opening up, China hasattracted more than$five trillion in FDI.FDI to China’s rapid economic developmenthas played an important role in promoting. In the1990s, FDI makes2.3%contribution to China’s average annual economic growth. In the past we put morepower on economic growth and how to get FDI. All this leads to Environmentalpollution. Unreasonable resources system and the imperfect system of environmentalprotection and inefficient law enforcement is also the reason to Environmentalpollution. The world’s ten most polluted cities, there are six in China. In2010China’sseven major river systems, only Yangtze River and the Pearl River have a goodquality.Yellow River and Liao he River was moderately polluted, and Hai He Riversuffered severe pollution. In the494city detected by China government,249cityoccurred acid rain Accounting for50.4%. China’s environmental problems becomeincreasingly serious and also get increasingly concerned about.In order to investigate the correlation between FDI and China, We use SPSS17.0software to research the1995-2010panel data by regression analysis and principalcomponent analysis. And we get that FDI and environmental pollution have positivecorrelation. For studying the relationship between FDI and the environment, first wetry to determine the impact of FDI on China’s economic growth, industrialrestructuring and technological progress by regression analysis.Second, we try todetermine the impact of economies of scale, industrial structure and technologicalprogress to China’s environmental pollution. And finally we determine therelationship between FDI and pollution.To solve the contradiction between economic development and environmentalpollution, we should try to increase the benefits of FDI to China’s economicdevelopment, while reducing the damage brought about by FDI to China’senvironment. In this paper, there are some relevant policy recommendations. First, weshould guide the industrial structure of FDI investment. Second, we can improve therelevant environmental protection legal system. Third, adjust to attract FDIdevelopment strategy. Fourth, implement into the concept of green GDP. Fifth, useFDI to promote the development of China’s environmental protection industry.