The Docking Research Of China (Shanghai) Pilot Free Trade Zone And U.S.-China Bilateral Investment Treaty Negotiations

Along with the boundaries of international mode of production in secondary or tertiary industry blurring, about2/3foreign direct investment (FDI) is flowing to service industry. The focal point for global trade liberalization negotiations changes from goods trade to service trade, promoting the liberalization of production factors (such as the capital). It is imperative to reform the foreign investment management system in China.This paper chooses Yangtze River Delta as an example to discuss three main kinds of carrier attracting FDI after1978, which are the export processing zone focusing on the development of processing trade, the bonded port areas focusing on the development of bonded business and the free trade zone focusing on the development of service trade. Based on above analysis, we demonstrated that despite the three different open park investment modes have their own focuses, generally they are derived from the same origin. They have the same aim in promoting the flow of capital and reducing the cost. By summarizing and analysis the development scales and the investment types in Yangtze River Delta, we expounded the propulsion effects for FDI via different open park investment modes, and pointed out that such effects will be strengthened with the continually innovation on the institution and the continually loosened investment environment. We also found that FDI has a long-term equilibrium relationship with economic development in Yangtze River Delta region by the empirical research method, and concluded that FDI is one of the crucial factors in driving local economic development.We think that the current foreign investment management system hasn’t been able to adapt to the development in our country and an urgent reform is on demand. The establishment of China (Shanghai) Pilot Free Trade Zone and the innovation on the foreign investment management system are fruits of such reform. We think that the reform has two main parts. One is integrating with the international multilateral investment agreement negotiation. We propose that the China (Shanghai) Pilot Free Trade Zone can be even jointed with the U.S.-China Bilateral Investment Treaty, and the China (Shanghai) Pilot Free Trade Zone can be taken as a test site to construct to serve for the regional economic cooperation and free trade area strategy. The other is to serve as a test base to provide experience for the whole country in reforming foreign investment management system. Currently we have built the "negative list" and the pre establishment national treatment in China (Shanghai) Pilot Free Trade Zone, and we have turned the original approval system to be after-supervision system, implementing the filing management system to the contract and project. We shall also be fair in competitions and the protection of rights and interests according to international standards in the future. Through the reform, we can change the role of government. Along with the docking test, it can form a copy to be applied to other parts of our country, providing new energy to the economic transformation.