A Study On The Impact Of China 's Private Enterprises' Foreign Investment On Their Business Performance After The Financial Crisis

After the 2008 financial crisis, China’s new foreign direct investment grew rapidly. Among them, the rise of private enterprises is particularly striking, private enterprises have significantly improved the investment scale and proportion. The reason behind this phenomenon is twofold:on the one hand, because of state-owned enterprises low income investment effect, people criticized the Government to promote foreign direct investment in private enterprises trying to solve this problem; on the other hand, the development of private enterprises has their own needs, that is, actively to open up overseas markets. Unfortunately, the yield of the private enterprise of foreign direct investment can not live up to the standard expected. In the future private enterprises as the main force of foreign direct investment will continue to show rapid growth.The reason of how foreign direct investment affects Chinese private enterprises has important theoretical and practical significance.From the enterprise level the factors that can affect the performance of the private enterprise of foreign direct investment, include investment location choice, choosing the investment industry, investment selection and investment motivation. Among them, the investment motivation is a comprehensive reflection of location, industry and the entry mode. Under different motivations, there are significant differences in the way the industry to select and investment pattern. Private enterprises investing abroad have a variety of motives, including:market development motivation, technology-seeking motivation, cost avoidance motivation and investment-oriented motivation. This in turn will lead to a discrepancy between private enterprises in the international investment performance.The theoretical part of this paper was presented a systematic study of China’s foreign investment issues for private enterprise theory development context, and explains why we choosed the choice of investment location choice, mode of entry and investment motives as explanatory variables. Empirical part paper selected 48 listed private enterprises, and through its published annual report sorted out its international investment data. By panel data model EVIEWS software, empirical study of investment location choice and mode for the parent company have management level impact. In analyzing the investment motives, we first used SPSS software, Q-type hierarchical clustering to get classification drawn 48 businesses tree, and complete classification. Then we used the software EVIEWS to empirically study connection between investment motives and performance of parent company.Through empirical analysis, we found that the overseas investment scale of private enterprises, export levels and operating efficiency, have significantly positive correlation.In investment location model, direct investment in developed regions, has the best level of export growth and operating efficiency. In the investment pattern model, private enterprises through mergers and acquisitions to invest overseas is worse than greenfield investments on the promotion of parent company’s operating efficiency. In the investment motive model, under cost avoidance, that companies choose emerging and developing countries as an investment destination, increase of operational efficiency is the most obvious. Under seeking technology motivation, that companies choose developed countries as an investment destination in the way of mergers and acquisitions, increase of operational efficiency is the least obvious.