A Study On Impact Of Chinese Outward Direct Invest On Manufacturing Upgrading

The rapid development of Chinese outward direct investment will become a new economic growth point, and promote industrial transformation and upgrading. China had become the first manufacturing country in the world, but the rapid development of Chinese manufacturing industry was based on low-cost labor force, the huge energy consumption and serious damage to natural resources. This extensive growth model will restrict the healthy and stable development of Chinese manufacturing industry. The situation allows of no delay, and it will also become an important aspect of China’s outward direct investment strategy.At first, how ODI affected the Chinese manufacturing upgrading was analyzed theoretically. ODI influenced Chinese manufacturing promotion through affecting the demand and supply. The demand factor could be divided into consumption demand, investment demand and export demand; the supply factor could be divided into natural resources supply, labor supply, technology progress and import supply.On the basis of theoretical analysis, this article carried on the empirical study further. First, the index system of China’s manufacturing industry upgrading was established, and the comprehensive score and ranking were got from1995to2012. Then selected6conduction variables according to the theoretical analysis, and the elastic coefficients of the impact of ODI on each conducted variables and the impact of conduction variables on Chinese manufacturing upgrading were calculated. Finally, the elastic coefficients of the impact of ODI on Chinese manufacturing upgrading through each conducted paths were calculated. The study found:ODI promoted China’s manufacturing industry upgrading through four paths of technology progress, export structure, import structure and investment demand, and promoting effect decreases in turn.Next the empirical study of the manufacturing sub-sectors was carried on and Jiangsu province were selected as a representative on the basis of manufacturing output, non-financial ODI and availability of the data. Firstly, the manufacturing industry of Jiangsu province was divided into labor-intensive, capital-intensive and technology-intensive manufacturing. Then the empirical study of the influence of ODI on the three-class manufacturing was carried on respectively. Conclusions: ODI impacted labor-intensive manufacturing industry upgrading of Jiangsu province through four paths of employment structure (+),consumption demand (+),investment demand (+) and export demand (-);ODI impacted capital-intensive manufacturing industry upgrading of Jiangsu province through four paths of investment demand (+), employment structure (+), technology progress (+),and export demand (-); ODI impacted technology-intensive manufacturing industry upgrading of Jiangsu province through four paths of consumption demand (+),export demand (+), employment structure (+) and technology progress (+).At the end of this article, the relevant policy recommendations were put forward.