Study On Fdi Location Selection Of Chinese Steel Enterprises Based On Multiple Criteria Decision Making

Iron and steel industry in the national economy plays an important role, it is also an important indicator of measuring the level of country’s economic development.After nearly 20 years development, the overseas investment of China’s steel enterprises has achieved some results, however, with the rapid development of the steel industry, the demand for iron ore is growing, so the steel enterprises in China have to go abroad and are actively in response to "go global" development strategy,then promote cross-border investment. It is gradually mature in developing the international market and using international resources, but it is still totally in infancy and all the conditions are not perfect, so that in the process of carrying out the strategy of "going out" enterprises are encountered some difficulties, what’s more, some enterprises are due to poor location choice which led to investment failure.Therefore,this article analyzes the development of FDI for China’s iron and steel enterprises from the perspective of regional selections, and it also provides guidance for the healthy development of China’s steel industry and its regional selections.Through referring to domestic and international scholars’ study on foreign direct investment theory regarding regional location, and analyzing to its complexity and uncertainty of effective factors, so we choose the method of multi-criteria decision analysis to put forward to the index system of FDI location choice for China’s steel enterprises.On this basis, using the model of multi-criteria decision analysis, this thesis analyzes the best location choice of foreign direct investment for steel companies(for the example of Capital Steel Group), and sort them into different grades, such as the best local countries(Australia, Brazil, Canada), better local countries(United States, Peru, Russia, India), suitable countries(Chile, South Africa,Mexico), and poor countries(Ukraine, Kazakhstan). Finally, according to the evaluation results, we put forward to some relevant countermeasures and suggestions for the China iron and steel enterprises in foreign direct investment’s location choice.As follows, this article consists of three parts:Part I: This part is foreshadowing some basis theory. Firstly it expounds the concepts and methods of foreign direct investment regarding to location choice, and analyzes the advantage of using MCDA to study FDI location choice; and then studythat which factors influence iron and steel enterprises to carry out FDI location choice.based on macro and micro levels, we sort those factors into six categories: natural and geographical factors, economic factors, political factors, cultural factors, institutional factors, and diplomatic factors, so we select some indexes for evaluating iron and steel enterprises’ FDI location choice.Part II: This part is to build a theoretical model. Specifically introduce how to build MCDA model about China’s steel enterprises’ foreign direct investment location choice, mainly including to the following steps: quantify the qualitative indicators;standardize each index in order to unify the same dimension for comparison; compute the single-level and comprehensive weight; Finally, sequence for the various schemes using Mathematical function.Part III: This part is empirical research. Based on the selection of indexes, we build the evaluated system of FDI local choice for China’s steel enterprises, and Capital Steel Group is selected as the research object. Then in accordance with the theoretical MCDA model, we sequence these 12 target countries. Ultimately determine which countries are the best local country, and which countries are in the position of poor location. So regarding to the ranking result, we analyze the local conditions of these countries. Finally, we provide appropriate guidance to promote the development of foreign direct invest for China’s steel enterprises.