Research On The Relationship Between Foreign Investment And The Import Of Resource Products In China

In recent years, because of the rapid development of domestic economy and limited resources, theoutput of resources products in our country has far cannot satisfy the needs of economic development, thesupply and demand situation is very serious, which puts forward higher requirements to resource imports ofour country. The import of resource products cannot completely rely on foreign companies. Iron oreimports in China has often been restrained, and it has been in a passive situation, which has well provedthat. However, a comforting phenomenon is that a lot of "going out" company in China is involved in themineral development abroad and exporting to China step by step. This will promote the import of resourceproducts in China in benign conditions, and it will make up for the shortage of resources products in ourcountry. Actively developing foreign direct investment and expanding import of the resource products is animportant strategy to make our country in the integrated into the tide of economic globalization,andmaintain the balanced development.At the same time, based on the objective requirement of economic development, our countryvigorously promoted the strategy of "going out", which included foreign investment as the main content,and then it achieved great success. At present, China has become one of the largest foreign investmentcountries in the world. Generally speaking, when foreign investment of country reaches a certain level, andtotal economy reaches a certain size, it is necessary requirement to develop foreign investment. In a generalmotivation, foreign investment can shift excess capacity, and obtain markets, resources, technology, etc.Among that, access to resources and markets is the most basic motivation. From the available information,a significant proportion of overseas investment in China will flow to the country that is rich in mineralresources, energy, resources. At present, seeking resource has become one of the factors that affected themain direction of foreign investment cooperation in China. Under this background, as the rapiddevelopment of foreign investment and economy, OFDI for seeking resource is increasingly become awidely concerned topic. So the clear relationship between resource imports and foreign investment is thekey to influence the long-term economic development of our country.This article is based on the following ideas to research. First of all, this paper describes the stages of development of foreign direct investment in China and current situation, and mainly analyzes in detailsome basic situation of our country’s foreign investment from the motivation of foreign direct investment.Secondly it describes nature of the resources product on the whole. Then from the two kinds of resourcesproducts: energy and metal ore, such as oil and iron ore, it describes the demand of resources products inour country at present and the basic situation of importing these resources from abroad. On this basis, fromthese several aspects, such as the motivation of China’s foreign direct investment, investment type andinvestment characteristics, this paper analyzes the relationship between foreign direct investment andresources import, and puts forward the theoretical assumptions that there is positive correlation relationshipbetween China’s OFDI and resource products import. Then this article selects four variables such as theresource imports in China, foreign direct investment, GDP and exchange rate, etc., and establishes thecorresponding empirical model, then carries on the corresponding test. Cointegration test showed thatexisting a long-term co-integration relationship between the four variables. Granger causality tests showedthat there is two-way causal relationship between foreign direct investment and resources import in ourcountry. At the same time, Linear regression results obtained that there was a positive correlation betweenChina’s foreign investment and resource products import. Specifically, that every1%increase in foreigninvestment in China will promote accordingly our nation’s resources product imports increased by0.1283%.Finally, this article summarizes the research conclusion of the full text, illustrates the research possibledeficiency, and puts forward prospect for future research.