Research On The Effects Of China.s Outward FDI On Its Industrial Structure Upgrading

At present, the global economy is entering the "Post Crisis Era", which has to experience a long-term process from "unbalanced" to "rebalancing" situation. International trade protectionism has been growing, and it will be at a high level for a long time. So it is very difficult to continue with development model of export-oriented economy. From the domestic point of view, due to appreciation of RMB existing for a long time, production factors’price rising up in a wave and situation of resource shortage hardly to be reversed fundamentally in a short term, extensive economic growth mode has to be changed and China’s industrial transformation and upgrading has to be accelerated urgently as well.Outward FDI (OFDI) was a special economic phenomenon in developed countries, which was very limited in developing countries with weak domestic economic foundation. From 1991 to 1970, more than 90% of the world’s OFDI was derived from the developed economies. In recent years, the scale of China’s OFDI has been growing rapidly, as the representative of developing countries. At the same time, the efficiency of China’s OFDI has been improving continuously. China’s OFDI net flows in 2002 reached $2.518billion, only accounting for a share of 0.48% globally. However, it sharply reached $123.12 billion, accounting for 9.1% of the total by the end of 2014, according to World Investment Report 2015 by UNCTAD.A large number of relevant studies have been carried out on OFDI and its industrial structure upgrading. The existing researches and theoretical achievements mainly focus on the definitions and measuring methods of industrial structure upgrading. In addition, they also focus on the location, industry choice, mechanism correlation and upgrading effect, etc. Most of the traditional econometric models are used in the analyses of the factors affecting the level of industrial structure upgrading. The conclusions are also different. On the basis of combing relevant literatures, this paper analyzes the development status and main characteristics of China’s OFDI as well as the temporal and spatial evolution characteristics of industrial structure upgrading in China. It not only analyzes the influence mechanism of OFDI to industrial structure upgrading theoretically, but also analyzes the industrial structure upgrading effects of China’s OFDI empirically with the help of geographical detector model and traditional econometric model.This paper consists of six parts, chapter Ⅰ briefly introduces the current development and research status of OFDI. On the basis of reviewing the domestic and foreign relevant literature, it expounds the main research content and technical route, introduces research methods and puts forward some difficulties and innovations in the research process. Chapter Ⅱ is the theoretical analysis, mainly introducing classical theories of OFDI and the influence mechanism of industrial structure upgrading; Chapter Ⅲ and Chapter Ⅳ analyze the present situation of China’s OFDI and industrial structure upgrading respectively. Chapter Ⅲ introduces the development course and main characteristics of China’s OFDI. Based on measuring China’s industrial structure upgrading, Chapter Ⅳ mainly introduces its spatial pattern and evolution characteristics in recent years; Chapter Ⅴ is the empirical part, analyzing the main impact factors of China’s industrial structure upgrading, with the help of geographical detector model. Combined with the traditional econometric analysis tools and spatial analysis methods, it also analyzes the industrial structure upgrading effects of China’s OFDI; Chapter Ⅵ is the main conclusions and policy suggestions. Through the above analysis, this paper gets these main conclusions as follows:1. Industrial structure upgrading of China which is stabilizing in general has achieved step growth. It successively experienced the period of "transition-rapid development-stabilization" from 2002 to 2014. Due to the impact of the global financial crisis, the growth of industrial structure upgrading in China had slowed down in 2008. However it reached the peak in 2011.Due to factors such as the global economic recovering slowly and the European sovereign debt crisis deepening, China’s industrial structure upgrading decreased slightly. Facing the severe challenges of downward pressure on macro economy, our government had adopted a series of reform measures including stabilizing growth, promoting reform, structural adjustment, benefitting people’s livelihood to promote upgrading of industrial structure. It achieved the highest in 2014. There is a close relationship between its step growth and international and domestic environment.2. There are differences in the industrial structure upgrading of different regions in China and the difference tends to be balanced. In summary, it is higher in east and north, lower in west and south during the period of 2002-2014 and there are large differences between different regions in China. Other’s industrial structure upgrading is significantly deepening except northeast area. The growth rates of industrial structure upgrading of central and western regions including Sichuan, Tibet, Guangxi, Guizhou, Hunan, Henan, with more backwardness advantages are higher than other’s in China. However, The growth rate of Beijing, Tianjin, Shanghai, Zhejiang, Guangdong and other eastern coastal regions with less first mover advantages are lower than other’s in China. In addition, the gap between western inland and eastern coastal regions continuously shrinks, and regional industrial structure upgrading tends to be balanced.3. There is a significant positive spatial correlation in the industrial structure upgrading of various regions of China. From the point of view of the spatial layout, China’s industrial structure upgrading regions with high levels are concentrated in the eastern coastal regions and it presents an "expansion to the east and south" development pattern. Beijing, Tianjin and Shanghai, whose radiation effects on surrounding regions are also more obvious, have been in the leading position all the time.4. The core regions of China’s industrial structure upgrading have been gradually emerging. With strong negative radiation on surrounding regions, industrial structure upgrading of Yunnan, Guangxi, Guizhou, Tibet and other regions have been at a low level. In the western regions, it is lower in Hebei and there is significant spatial diversity between Hebei and other surrounding cities such as Beijing and Tianjin. In the eastern regions, Jiangsu and Shanghai have been at a high level with strong radiation on surrounding regions. As the stable high-high clustering regions, they have become the core regions of China’s industrial structure upgrading.5. As one of the main factors that affect China’s industrial structure upgrading, China’s OFDI which is highly relevant to the industrial structure upgrading has a direct impact on it. On the basis of econometric model, we further find that there is a statistically significant positive correlation between China’s OFDI and its industrial structure upgrading. OFDI promotes the optimization and upgrading of industrial structure in China.6. Industrial structure foundations in different regions of China differ, so does the promotion effect of China’s OFDI on its industrial structure upgrading. Beijing, Tianjin, Hebei, Shanxi,Liaoning, Heilongjiang,Shanghai,Jiangsu,Zhejiang,Shandong, Guangdong and other eastern coastal regions are higher than the national average, while Inner Mongolia, Jilin, Anhui, Fujian, Jiangxi and other central and western regions including Henan, Hubei, Hunan, Guangxi, Hainan, Sichuan, Yunnan, Tibet, Gansu, Xinjiang are lower than the national average. Heilongjiang’s OFDI has significantly played an inhibitory role in the industrial structure upgrading. Except Heilongjiang, other 30 provinces and cities’ have exerted great function in promoting their industrial structure upgrading. Tibet, Guangxi, Sichuan, Chongqing, Hunan, Henan, Guizhou and other south central and southwest regions of China are relatively larger than Shanghai, Tianjin, Beijing, Jiangsu and other eastern regions as well as Xinjiang, Ningxia, Gansu, Qinghai, Shanxi and other northwest regions.7. China’s industrial structure upgrading is also affected by economic development, energy, capital, labor force, consumption level, technological progress, international trade and other factors. Differences from different factors to industrial structure upgrading in different periods do exist. Further analysis of this thesis shows that economic development, energy and labor force have remarkable effect on China’s OFDI, but foreign direct investments plus import and export factors have not.