Influencing Factors Of China’s Outward Foreign Direct Investment Of Electric Power Industry

ABSTRACT:The power industry is a fundamental and strategic industry in our country, the development of China’s electric power industry play an important role in the promotion of national economic development, ensuring national economic security and improving the national comprehensive strength. In recent years, in the face of the high coal prices, tight monetary policy, strict energy conservation requirements, increasingly saturated domestic regional market, China’s power industry has unprecedented challenges. With the spread of the financial crisis, the imbalances between the world’s electricity production and supply and "going out" strategy that the Chinese government actively and orderly conduct and under the guidance of the multinational operations policy, more and more enterprises have accelerated the "going out" pace to increase foreign direct investment in order to reduce costs, avoid trade barriers and start a new profit growth point by entering into the traditional model of international markets with breaking through main electricity export.In this paper, we analyze the domestic and international literature on foreign direct investment factors by using methods of the theory and qualitative analysis and then considering the current domestic and international research, we also analyze the status quo of China’s direct investment in the power sector, based on this, using theoretical and quantitative analysis methods we derive factors of foreign direct investment in the power sector and select quantified factors as a variable. by using the data from2000to2012,we take use of regression analysis to explore the effect between level of domestic economic development, the total production of electricity, gross world product and China’s foreign exchange reserves and foreign direct investment in China’s power industry, in the end, we draw conclusions.The regression results show that it has a significant positive correlation between level of domestic economic development, gross world product and China’s foreign exchange reserves and foreign direct investment in China’s power industry, while it show a significant negative the correlation between the total production of electricity and foreign direct investment in the power sector. Finally, on the basis of this study, this article summarizes the conclusions.