Analysis On The Impact Of OFDI Of Cross-Border E-Commerce Enterprises On Foreign Trade In China

Since 2015,upon remarkable achievements of the cross-border e-commerce, numerous traditional industrial economies have explored economic transition making sense for networks to connect, with one being the transnational trade. For almost two years now, unfavorable conditions have significant impacts on China’s foreign trade, such as international demand sluggishness, and domestic economic depression as well as commodities like oil prices collapse, and what so ever; thus, the data with respect to transnational trade failed to meet expectations. Against this background, as a new type of trade, recent breakthroughs of the cross-border e-commerce point the way for an improved version regarding strategy transition of China’s foreign trade and foreign direct investment. In June, the State Council promulgated the "the guide on Promoting Sound Development of Cross-border E-commerce", underlining the "Internet + trade", which emphasizes the e-commerce platform to develop transnational trade, to play the advantages of a-manufacturing-country, to achieve eugenic evolution, so as to speed up transition and upgrading of processing trade, promote economy development and create a new economic growth point. Clearly, whether it can catch the opportunity to develop cross-border e-commerce or not is being a crucial key to the growth of transnational trade.This thesis mainly offers a conceptual review in terms of cross-border e-commerce of foreign direct investment to investigate how e-commerce stimulates domestic consumption, and subsequently increases profitability through foreign direct investment. E-commerce establishes and improves logistics, online payment and other related industrial chains in the target market, thereby reducing cost and promoting performance. Not only does e-commerce generate the development of China’s trade, but also that logistics produced by commercial enterprises provide advantages for future trade development and ultimately to boom China’s overall trade economy. In order to explore the impacts of cross-border e-commerce to foreign direct investment on foreign trade, firstly, this thesis will overview the development status of cross-border e-commerce, the types of foreign direct investment associated with real examples to address the impact on China’s foreign trade which e-commerce generates. Furthermore, this thesis will establish VAR model to analysis the three index data(the number of e-commerce transactions, the export and import of the processing trade and users of online shopping between 2001 to 2014). Finally, this thesis will address the proposals of e-commerce on foreign direct investment for the sake of bettering development of China’s transnational trade.