Research On The Location Choices And Motivations Of China’s Outward Foreign Direct Investment

As the growth of economy and the implementation of "Going Out" strategy, China’s enterprises’ foreign direct investment increase rapidly. Actively guide enterprises to engage in foreign direct investment in China is not only able to narrow the gap with developed countries in terms of foreign direct investment level and balance international payments, but also to adapt to the inevitable choice of the wide recognition of the international community global economic integration. Conducting research about the location choice of foreign direct investment and motivations of Chinese enterprises, not only has practical significance, but also has the meaning of theoretical innovation. In this paper, based on the existing theory and empirical research about foreign direct investment, we conducted empirical test on the panel data sample of China’s foreign direct investment in30countries and regions during2005-2011and studied the motivations and location factors that determining foreign direct investment. The study found that the size of the economy of the host country, the potential for economic growth, the level of infrastructure construction, the openness, natural resource endowments and other factors to produce the positive role in promoting China’s foreign direct investment. The results also show that the current motivations of China’s foreign direct investment are market seeking, resource-oriented and trade promotion type. Based on the resulted found, this paper proposed policy recommendations to promote and optimize China’s foreign direct investment.