Study On The Influence Of China’s Foreign Direct Investment In Africa On Chinese Enterprises’ Project Contracting In Africa

In recent years,the overall projects turnover contracted by Chinese enterprises has shown a declined and a lack of development momentum in Africa,the second largest market for China’s international project contracting.The shortage of funds has become one of the main constraints notably restricting the development of African project contracting scale,even though many countries have tried to revitalize their economy through driving infrastructure development.Under this circumstance,African countries prefer the cooperation mode driven by investment or financing.Meanwhile,China’s FDI in Africa has developed rapidly under the background of "The Belt and Road Initiative","Investment-driven project" proposed in the Forum on China-Africa Cooperation and other strategies and policies,tending to exceed the scale of international project contracting with a high probability.As a consequence,it’s necessary to study the influence of China’s FDI on Chinese Enterprises’ Project Contracting in Africa.In this way,the relevant research theories will be enriched and the new approach for growth of the international project contracting in Africa is also under exploration.Based on the panel data of 35 African countries from 2009 to 2019,this paper establishes an empirical model to examine the influence of China’s FDI on international project contracting under the influence of the factors such as the level of economic development,natural resources and labor resource endowment.The research shows that China’s FDI has a significant driving effect on international project contracting,and China’s international project contracting prefers the countries with high levels of economic development and abundant labor resources,but not sensitive to the natural resources.Meanwhile,the level of economic development,natural resources and labor resources will not reduce the driving effect of China’s FDI on international project contracting to a certain extent.Furthermore,the classification research of samples in this paper shows that the driving effect of China’s FDI in middle-and-high-income countries is significantly stronger than that in low-income countries,and in low-income countries,China’s international project contracting shows more interest in the markets with abundant labor resources.Under the reference of geological location,in the Midwest of Africa,China’s international project contracting prefers countries with high levels of economic development and abundant labor resources,while in the Southeast of Africa,China’s FDI has a stronger driving effect on project contracting.The conclusions of this paper can provide a supplement for the relevant theoretical research on China’s FDI and international project contracting in Africa.At the same time,for Chinese enterprises,it can give references to problems research,strategic analysis and location selection in the process of contracting engineering business in Africa.