The Effects Of China's Outward Foreign Direct Investment On Export In ASEAN

Trade exports and foreign direct investment are of vital importance to both countries and businesses.For multinational enterprises,trade exports can open up the market;foreign direct investment allows enterprises to bypass trade barriers and make full use of local resources,and thus the development of multinational companies.For the country,trade export is one of the most important economic factors;foreign direct investment can promote the growth and transformation of multinational enterprises,and thus promote the whole country's industrial structure upgrade.However,the relationship between trade exports and foreign direct investment has not been finalized for more than half a century.Some scholars believe that foreign direct investment promotes the country intermediate product exports;some scholars believe that,in different industries and countries,and promote the effect of substitution effect exists.In recent years,the economic exchanges between China and ASEAN have become more frequent.With the formal completion of the China-ASEAN Free Trade Area in 2010,China's trade in ASEAN has nearly doubled in four years and increased by 1.77 times to ASEAN's direct investment flows.In this context,the direct investment of Chinese enterprises in ASEAN is to sacrifice or promote the export of trade?In order to solve this problem,this paper first reviewed the literature at home and abroad,and analyzed the discussion of the relationship between trade and foreign direct investment among different countries.According to the 2003-2014 data,China's direct investment in ASEAN and trade exports of two aspects of the macro trend analysis.This paper analyzes the five types of export effects of international direct investment: the positive trade creation effect triggered by production lines,capital equipment and intermediate products;the positive market expansion effect caused by foreign trade companies,sales outlets and after-sales services;The negative export substitution effect caused by the competition of the company,the positive and negative technical spillover effect caused by the technology transmission,and the positive income creation effect caused by the increase of the employment rate of the host country.According to the different motivations of international direct investment,this paper analyzes the export mechanism of export effect: the market-seeking investment triggers the effect of trade income and market expansion at the beginning of construction,which leads to the effect of export substitution after the maturity of overseas enterprises.The efficiency-seeking investment will triggers market expansion effect;resource-seeking investment due to imports from the home country mining equipment triggered a trade creation effect.If finished product was made by the enterprise using resources in the local that will lead to export substitution effect,if the enterprise ship back resources to the home country that will lead to market expansion effect;technology-seeking investment is the way to obtain technology and improve product quality,trade in goods and service trade,that lead to the market expansion effect.Since international direct investment contributes to the employment of local residents,any investment motive can lead to income creation.This paper discusses the export mechanism of Chinese enterprises' direct investment in ASEAN.Then,according to the data of 2003-2013,the variables such as per capita gross domestic product(GDP),shipping railway aggregation and basic communication facilities are set up and the trade gravity model is established.After the regression analysis of the panel data,it is concluded that China's direct investment in ASEAN is in general to promote the export of trade.China's exports to ASEAN will increase by 0.173% for every 1% increase in direct investment in ASEAN.On the basis of this,this paper chooses the variable coefficient model to examine the individual differences of the export effect by the two F statistic judgments,and obtains the export substitution effect of Laos and Cambodia and the complementary effect of the export of other countries.Finally,a summary of the policy and put forward the policy recommendations.