A Study Of The Effects Of Financial Development In The Belt And Road Countries On China's Outward Foreign Direct Investment

With the further advancement of economic globalization,China's process in "going global"strategy is accelerating,the "Belt and Road" strategyprovides a broad platform for China to makethe expansion of outward foreign direct investment.However,how to explain the difference between China's investment scales in different countries?The financial development in the host country is an important factor.As everyone knows,the financial development can provide Chinese companies with diversified financing channels and reduce financing costs.Therefore,it's very necessary to research the impact of the "Belt and Road" countries',financial development on China's outward foreign direct investment,because this research has the practical significance of promoting China's investment in related countries,and also consolidating the coordinated development of "Belt and Road" countries.Firstly,based on the eclectic paradigmofinternational production theory,motivation factors combination theory and functional finance theory,the paper proposes the mechanism of the host country's financial development affecting foreign direct investment,and studies the effect of the"Belt and Road" national financial development to China's foreign direct investment.It is believed that the financial development of countries along the route will increase China's outward direct investment by reducing the financing constraints,reducing risks and optimizing capital allocation and promoting technological innovation and increasing productivity.On the basis of constructing a theoretical framework,the dissertation makes a descriptive analysis of the status and influence of the host country's financial development and China's foreign direct investment,and conducts an empirical analysis.The empirical analysis section examines the impact of the financial development of the countries on China's foreign direct investment in the entire sample and the samples grouped by income level.The empirical results show that when analyzing the entire sample,the depth of financial development,banking system scale,financial efficiency,and financial stability can significantly promote China's outwardforeigndirect investment,while the scale of the financial system is not significant.Chinese enterprises are more inclined to choose countries with deep financial development,large-scale banking systems,high financial efficiency,and a stable financial system among outwardforeign directinvestment.Comparing the differences in the financial development of countries with different income levels,we can find that the financial system scale of high-income countries has significantly promoted China's outwardforeign direct investment,and financial efficiency is no longer an important consideration for China's regional selection.Other results are consistent with the entire sample.The impact of different host country financial development indicators on China'soutward foreign direct investment isdifferent.In order to ensure the rigorous results of the research,the dissertation replaced the variables and conducted a robustness test.The results obtained were basically consistent and proved that the results were robust.Finally,based on the research conclusions,the article puts forward policy recommendations for government and companies,suchas continuing to promote financial development and strengthening international financial cooperation.