The Analysis Of The Influence Of China’s Foreign Contracted Projects On Outward Foreign Direct Investment

March 27,2015 China National Development and Reform Commission, the Ministry of foreign affairs and the Ministry of Commerce in Boao Asia Forum, jointly issued a "promote the construction of Silk Road and Silk Road in twenty-first Century, the vision and action", which marks the "One Belt and One Road" strategy being into a comprehensive advance construction stage. "One Belt and One Road" also marks the focus of China’s participation in international competition transferred from the former "introducing" to the present "going out", since then, Chinese Reform and Opening-up ushered in a new stage. The implementation of the "going out" strategy will help China to cooperate and compete with other countries in a wider field, and optimize the allocation of resources in a wider market, so as to obtain capital, technology, market and resources, and improve the international competitiveness.In the process of carrying out the strategy of "going out", we have put the foreign contracted projects and foreign direct investment in a main position. Under the current international economic background, multinational enterprises have to face the fierce international competition. Compared with the western developed countries, China’s foreign contracted projects and outward foreign direct investment started late, the scale is small, theoretical research on this aspect is also lag obviously. Faced with opportunities brought by economic globalization, many China enterprise has entered the international market successfully, however, failure cases caused due to not adapted to the international market environment are too numerous to enumerate. Failure cases indicate that the foreign contracted projects and outward foreign direct investment in China need to be improved at this stage. At the same time, as a developing country, China has its own characteristics in the political system, historical and cultural and economic development, which is different from other countries. So this paper analyzes the current situation of China’s foreign contracted projects and outward foreign direct investment. Based on the domestic reality, the influence mechanism of China’s foreign contracted projects on outward foreign direct investment is discussed, and the empirical research based on panel data model is carried out. Finally, based on the model results, combined with the status quo of China’s outward foreign direct investment and the foreign contract project, we put forward suggestions for the development of China’s foreign contracted projects and outward foreign direct investment.In this paper, we have reviewed the existing domestic and foreign literatures, and found that there is no unified view and conclusion about the influence of foreign contract projects on the outward foreign direct investment of China. But from the existing literature, we can see that some scholars have begun to pay attention to the relationship between the foreign contract engineering and outward foreign direct investment. This paper is based on the analysis of the literature to be further deepened and expanded. In the third chapter, the paper analyzes the current situation of China’s foreign contracted projects and outward foreign direct investment. Subsequently, this paper further explores the mechanism of the influence of foreign contracted projects on outward foreign direct investment, which is based on the present situation of foreign contracted projects and outward foreign direct investment. Then we found that the external contracting projects through the following four ways to produce a driving role for outward foreign direct investment: the way of deepening economic diplomacy to expand overseas market for our country outward foreign direct investment; the way of changing resources by engineering to provide opportunities for outward foreign direct investment; the way of driving overseas demand to drive China’s outward foreign direct investment; the way of cooperating through construction operation to directly driving outward foreign direct investment. Then, we use the data of China outward foreign direct investment industry distribution data in 2007-2013 to analyze the influence of foreign contract projects on the structure of outward foreign direct investment industry in China. The study found that, under the premise of other conditions, foreign contracted projects, the host country market size, the investment country and the host country’s import and export trade situation has a significant effect on the outward foreign direct investment of china. The influence of foreign contract projects on the outward foreign direct investment in China is very important, under the same conditions, the amount of China’s foreign contracted projects changes 1%, the amount of China’s outward foreign direct investment changes 0.14% in the same direction.According to the present situation of China’s foreign contracted projects and outward foreign direct investment, taking into account the results of empirical analysis, this paper puts forward some policy suggestions on how to develop the outward foreign direct investment and foreign contracted projects in our country.