The Impact Of Trade Friction On China's OFDI

The United States has imposed unequal tariffs on 250 billion US dollars of Chinese goods.Surveys show that this behavior has had a negative impact on many Chinese enterprises' export business.More Chinese enterprises have chosen or will choose to transfer production in order to evade the trade barriers of the United States to China.Therefore,Sino-US trade frictions will not only have impact on China's foreign trade,but also on China's foreign investment.Under this background,this thesis studies the impact of trade friction on China's foreign investment.On the basis of sorting out relevant literature and theories,this thesis constructs a model about Chinese enterprises' choice of exporting or investing in the host country when facing the anti-dumping measures firstly.Then,it collates the data of the “List of Enterprises' Overseas Investment” published by the China's Ministry of Commerce and TTBD's GAD database,which sort out the panel data of China's investment to 29 countries and the stock of those countries' anti-dumping measures against China in 11 manufacturing industries from 2006 to 2015.Based on this panel data,this thesis empirically analyses the impact of trade friction on China's OFDI in industry level.The empirical results show that the host country's anti-dumping measures against China will significantly promote the Chinese investment in that country in general.Whenever suffers from an anti-dumping measure,the number of Chinese investments in that country's industry will increase by an average of 4.34 percentage points.And the impact is heterogeneous among different countries and industries: Host country with better business environment is more likely to promote the Chinese investment;Anti-dumping measures in capital-intensive industries are more likely to promote the Chinese investment than resource-intensive industries and laborintensive industries.Based on this general research conclusion,this thesis takes Sino-US trade friction as an example to carry out a typical factual analysis,and puts forward targeted policy recommendations for China.