The Influential Factors Of Investment Performance Of Chinese Foreign Direct Investment Into The African Market

Africa's bountiful natural resources (from oil and gas mining to an abundance of crops), vast one billion person marketplace, economic performance and growth, suitable environment for industry optimization and development, coupled with the European Union's generalized scheme of tariff preferences (GSP) and America's trade preferences make Africa one of the most important partners for Chinese with regards to development, advancement and strategy.For Chinese enterprises, Africa is the ideal location to accomplish their goals of improving enterprise internationalization, upgrading core competencies and bettering implicit knowledge. By becoming a leader in the African market, Chinese enterprises not only effectively optimize their industrial structure, but also address the problem of surplus production capacity by moving their marginalized industries to Africa and accommodating the needs and demands of the African countries.This study focused on two topics. The first theme investigated how the major factors, the Ownership Specific Advantages, Location Specific Advantage, Motivations of Enterprise Internationalization, influence the Investment Performance of Chinese Foreign Direct Investment into the African Market. The second theme analyzed influence by different kind of entry models, the Moderating Variable, between the Ownership Specific Advantages and Investment Performance, the Location Specific Advantage and Investment Performance, and the Internationalization and Investment Performance.After careful research and analysis, we found several results. First, the Ownership Specific Advantages, Location Apecific Advantages and Motivations of Enterprise Internationalization significantly affected the Investment Performance of Chinese Foreign Direct Investment into the African market. Second, different kind of entry models of Chinese direct investment in Africa do affected the Investment Performance with the Ownership Specific Advantages, Location Apecific Advantages and Motivations of Enterprise Internationalization, and as a wholly-owned enterprise model was more advantageous and profitable than the joint-venture model.Furthermore, this study also discussed issues, problems and solutions with regards to Chinese companies when they made foreign direct investments in Africa while simultaneously using reference survey analysis to enhance the richness and depth of this study while retaining objectivity.Finally, this study provides suggestions and strategy regarding direct investment in Africa for Chinese enterprises in both macro and micro aspects. Chinese enterprises should work with the African government on implementing several macro-strategies that include:the formulation of overall strategic plans related to the establishment of an African investment promotion office, creation of laws and regulations to help Chinese enterprises for internationalization, improving the competitiveness of Chinese enterprises and discovering a transfer mechanism of marginal industries to African countries. Several micro-strategies that are also presented in this study include:strategic planning by Chinese enterprises that should carefully assess the investment environment, careful selection of entry model into the African markets, establishment and utilization of the modern company management system and the strengthening of international cross-border human resources management and personnel training.