Based On Trade Effects Of Foreign Direct Investment And Industrial Structure Perspective

After the worldwide financial crisis, unstable factors abound in economicdevelopment. The shortage of key resources, the quest for a low labor, the expansionof markets and the improvement of production technique make enterprises faceintense competitive pressures from home and abroad. Foreign Direct Investmentbecomes one of the most effective ways to solve these problems. China takes Yunnanas the bridgehead of the opening up to the southwest. Yunnan is also the Experimentaland Leading Area of the southwest to implement foreign direct investment. And Chinatakes Yunnan as the core area to establish Asian Free Trade Area and South Asiansubcontinent trade area. With the growth of economic and the scale of foreign directinvestment become gradually larger and larger, trade effect and industry mix effect offoreign direct investment continue to highlight. Foreign direct investment plays amore and more important role in the growth of economic. Under the background ofglobalization and increasingly clear international division of labor, empirical researchon the impact of foreign direct investment on trade industry structure of Yunnanprovince can provide factual significance to improve trade structure and adjustindustrial structure, and how to guide foreign direct investment. Meanwhile researchresults could directly provide empirical support for decisions and policies making forforeign direct investment in Yunnan.On the basis, the research methodology of this thesis combines theoreticalanalysis with authentic proof analysis and carry on the thorough analysis on theforeign direct investment’s effects. First, this paper reviews the foreign directinvestment in industries related to theory, trade effect and literature of industry mixeffect. Then it makes a thorough analysis on the status of FDI and foreign trade ofYunnan province. On the basis of the theory of foreign direct investment trade effectand industry mix effect use econometric model to make empirical analysis on therelationship between foreign direct investment and industrial structure of trade. Then in the conclusion, no matter in short-term of in long-term, foreign direct investmenthas a positive effect on both import and export of Yunnan province and foreign directinvestment can adjust and optimize industrial structures. And in short-term, foreigndirect investment’s effect on upgrading the industrial structure is not obvious. But inlong-term, significant effects on the industry structure promotion will appear. Finally,based on the conclusion, relevant countermeasures are put forward and further putforward suggestions to expand foreign direct investment. And make full use of theeconomic effect by foreign direct investment to improve trade structure and readjustindustrial structure.