A Study On Korean Manufacturing Foreign Direct Invest In China

This thesisanalyzes theproblems and presents improvement methods when Korean firms invest in Chinese manufacturing industry.To achieve this,this thesis studies the background, motivation and determinants of foreign direct investment first, and analyzes manufacturing competitive present status and prospect of china and Korea. On this basis, this thesis analyzes the scale and feature of the China market.Since the China’s reform and open policy was conducted in1978, the average gross domestic product per annum increased to reach the9%, In2009, China is already the world’s2nd largest economy country.Meanwhile, because of China’s cheap and abundant labor etc, Korea’s manufacturing companies have steadily increased investment to China.This study aims to explore Korea’s foreign direct investment in Chinese manufacturing industry. In order to carry out the purposes of this study, this thesis focus the government policies, taxation system, business environment etc, and does an in-depth analysis on the problems to invest in China.The strategies for investment of Korean manufacturing firms to China can be summarized as follows:First of all, we should be aware of the socialist market economy to respond the Chinese change of policy.Second, we should be aware of transfer prices to respond difficulties in the tax system.Third, we should minimize trial and error by a thorough preparatory research about Chinese management surroundings to respond the change of chinese management surroundingsFourth, we should implement labor management that conform to Chinese environment to respond difficulties in the labor management. Fifth, we should enter the domestic market after sufficient recognition and thorough analysis of Chinese domestic market to respond difficulties in the Chinese domestic market.