Study On The Effect Of FDI In Insurance Sector On China’s Insurance Service Trade

Along with the international trade pattern changes to the service trade gradually, thestatus of the service trade in international trade is more and more important. At the same time,Insurance service trade along with the development of service trade in the international tradeis also gradually emerging. And along with the development of foreign direct investment inservice, foreign direct investment in insurance service sector of China has maintained a rapidgrowth. With the insurance industry FDI inflows to Chinese insurance services, what effectdose the FDI to insurance services of China?Is there a relationship between the FDI and thedevelopment of the insurance trade in china? Those problems are this research attempting tostudy and solve.This paper takes the impact of insurance sector FDI on China’s insurance service trade asthe object of study. Firstly, the author elaborates the basis theory about the impact of FDI onthe insurance service trade and give a brief theoretical analysis. Then the author conducts astatistical analysis and empirical analysis by selecting the related data from our insurancetrade to analyze the relationship between FDI and China’s insurance service trade. Specificresearch ideas as follows: First of all, the author elaborate the basis theory about the impact ofFDI on the insurance service trade and the author defines the insurance industry FDI.Secondly, the author puts a analysis of the motives of the insurance industry FDI to Chineseinsurance services trade simply and the author puts a analysis of the present situation of FDIin the insurance industry and insurance service trade development. And then the author givestwo aspects of comprehensive analysis about the insurance industry FDI effects on insuranceservice trade of our country using the statistical analysis method. In the part of empiricalanalysis, the author tests the relationship between China’s insurance industry and the FDI ofinsurance service by selecting the related data from our insurance trade in1998～2012yearsto establish a regression model to analyze the relationship between FDI and China’s insuranceservice trade, exports, imports, net exports, the intra industry trade index (G-L index), tradecompetitiveness index (NTB) and market share of Chinese insurance trade services.The result of empirical research and theoretical analysis is consistent with each other. The results shows that: The insurance industry FDI promoted our country insurance servicestrade volume growth, promoted the transformation in the way of insurance service trade inour country to make our insurance trade in services more convenient. And FDI in insurancesector has a slight effect on enhancing the competitiveness of Chinese insurance services trade.But the FDI also intensified insurance service trade deficit in our country and worsen theoutlet concentration of our country’s insurance service trade. At the same time the domesticinsurance regulators brought a certain degree of regulatory pressure. From a long-term pointof view, China should still continue to attract FDI in insurance industry. But it need to giveproper guidance in the use of the FDI in insurance industry to ensure that the insuranceindustry FDI positive effect can full play and avoid the negative effects expansion.Finally, according to the conclusion of this research and the characteristics of thedevelopment of insurance service trade of our country, this paper puts forward correspondingcountermeasures and suggestions from national, industry and enterprise levels. At the nationallevel, that our country should deal well with the relationship between the insurance industryopening and protection and strengthen the insurance industry FDI guidance and open theinsurance industry to promote the internationalization of banking supervision; At the industrylevel, our country insurance regulatory departments should strengthen the study ofinternational insurance regulatory polices and measures by taking the initiative with theinternational insurance supervision organization of exchanges and cooperation and alwayskeep the industry self-discipline to supplementary supervision; At the enterprise level, ourinsurance companies should seize the opening insurance market opportunity to enhance thecapability of independent innovation by using FDI and create their own brand of service tobuild an international financial services group by exploring the international market actively.