A Study On Trade Effect Of China's Outward Foreign Direct Investment To Southeast Asia And South Asia

As the major handles of Chinese participation in the international economic cooperation,OFDI and international trade concern the overall situation of our new round opening-up program and transforming development of national economy.Owing to the rapid growth of economy,the world's emerging markets and rising nations--Southeast Asia and South Asia play important roles in the pattern of China's foreign trade and economic cooperation.Over the past decade,Chinese large-scale investment in the two regions recorded blistering growth,and the bilateral trade was highlighted in the pattern of China's foreign trade.With the development of regional economic integration and the comprehensive upgrades of the new round opening-up program,the international economic cooperation between China and the two regions will usher in a bright future.The synergy development between Chinese OFDI and the bilateral trade is especially noteworthy.Based on reviewing the existing literature and practical research,this paper focuses on the trade effects of China's OFDI to Southeast Asia and South Asia,include the scale effect and the structure effect.By exploring the mechanism and the influence,this article aims at providing several targeted policy enlightenments which contribute to expand ideas for the in-depth economic cooperation between China and two regions.It is of great academic and realistic significance.Firstly,the article analyzes the mechanism of OFDI's trade effect on scale and structure,makes a conclusion that OFDI under different motives results in complicated effluence on both sides,and the effects depend on the resultant force of all types of OFDI.Secondly,based on statistical analysis of the current situation and characteristics about the bilateral trade and China's direct investment in the Southeast Asia and South Asia,it appeared that investment scale of China grows vigorously with the fields of investment-related wide spread,while the bilateral trade achieves sustained development and the structures show opposite trend.Thirdly,by using OFDI and trade in2004-2014 yearly data between China and two regions,this study made an empirical analysis for the effect of OFDI on bilateral trade,and the result examined that OFDI not only accelerates export trade and improves the export structure but also hinders import scale and tunes the imported goods structure.Finally,through summary of the theoretical analysis,the status and the empirical research,this article comes to related conclusions and offered several policy enlightenments to promote positive interaction between OFDI and bilateral trade.