The Research Of FDI Effect On Foreign Exchange Reserve Scale

Along with the world economy continues to decline today,China's foreign direct investment still grows fast,the foreign business people are confident with our country's economy,also in a certain extent,indicates that China's foreign exchange reserves will continue to grow. China has accumulated huge foreign exchange reserves in the past decades,which has the resistance ability to keep China's external payments and regulation in international balance of payments,intervention in the foreign exchange market,the stability of the currency exchange rate,improve the external financing and resistance risk in the world economic downturn,in order to maintain our good international reputation;but it also means our country gave up a lot of equivalent economic resources into the production and innovation,is not conducive to the sustained growth of China's economy.Therefore,it is urgent to study the influence of the scale of foreign exchange reserves by foreign direct investment.Comprehensive exposition of the influence the scale of foreign exchange reserves by foreign direct investment.Firstly,from the monopoly advantage theory,internalization theory and product division of labor theory to analyze of the causes and conditions of foreign direct investment;secondly,the analysis of the reasons for the growth of foreign exchange reserves in East Asia from the theory of mercantilism.Again,the explanation of the combination of foreign direct investment with the status of China's foreign exchange reserves,in the statistical data of the large size of the data fluctuations on the impact of foreign direct investment on the scale of foreign exchange reserves.Finally,through the research of the realistic influences as the foreign direct investment inflow from the two aspects of the current account and capital account of China's foreign exchange reserves.Therefore,it has important significance for the study of foreign direct investment on the impact of foreign exchange reserves.So,the authors began to collect a lot of data,based on time series cointegration and uses of VAR model to do the empirical analysis of the impact of foreign direct investment on the foreign exchange reserves,for reference of the healthy development of China's foreign exchange reserve.Finally,aiming at the existing problems of China's foreign exchange reserves,and put forward some policy suggestions from the angle of Foreign Direct Investment:the first one is to determine the overall principle,the introduction of foreign direct investment based on domestic demand for industrial policy through introducing foreign direct investment policy,build the balance of foreign direct investment and domestic competition environment and to develop a suitable for the line of foreign direct investment in the introduction of China's economic development,to reduce the vibration amplitude of Chinese foreign exchange reserve scale,the second one is to optimize the direction of foreign direct investment inflows,foreign direct investment is increased by the strength of the support of new and high technology development,the strategic adjustment of foreign direct investment inflows and improve between industry in our country the influence of FDI on China's export,to adjust the structure of the source of Chinese foreign exchange reserve scale,the third one is to regulate mergers and acquisitions,foreign direct investment in China by the understanding of the correct foreign direct investment(FDI)in mergers and acquisitions,a reasonable grasp of foreign direct investment into the degrees,clear the government role in merger and acquisition of foreign direct investment,to promote Chinese foreign exchange reserve scale has grown steadily.Through kinds of means above,we can achieve the effect of promoting the healthy and rational development of Chinese foreign exchange reserve scale.