A Study On The Trade Effects Of China's Outward FDI To ASEAN Countries

With the further enhancement of China's economy strength and the accelerated pace of entering into the economic integration,China's foreign direct investment has appeared a trend of faster growth,and formed a certain scale.Chinese enterprises' direct investment in the ASEAN region also showed a trend of rapid growth.From the previous literatures,we can see that a country's outward foreign direct investment(OFDI)and trade are closely related to each other.OFDI could complement or substitute international trade,and different motives of OFDI would affect the home trade in different paths.This paper combines the qualitative analysis with the quantitative analysis,the theoretical analysis and the empirical test,and the related theoretical knowledge of international trade and international investment.It analyzes the main motives of China's OFDI to ASEAN and its effect to the home trade.After analyzing the statistical data,this paper suggests that market-seeking is the main motivation of China's OFDI in ASEAN countries.Resource-seeking is an important motive for China's OFDI in ASEAN countries.The international trade between China and ASEAN countries is growing with the improvement of market-seeking and resource-seeking OFDI.In this paper,a random effects model has been used to analyze the panel data of OFDI and trade between China and ASEAN in 2003-2014.The result shows that OFDI in ASEAN countries,which take market-seeking as the main motive,has a positive effect on trade.In this paper,the time series data from 1996 to 2014 has been used.We find that China's OFDI to the ASEAN countries can significantly promote the import of resources from ASEAN in the long-term,and the short-term effect is not obvious.