| Since China's reform and opening up, the foreign direct investment (FDI) has made great progress, the amount of foreign capital actually utilized has been 37.948 billion U.S. dollars in 2008 growing from almost 0 dollar in 1979.FDI played as an important role in forcing China's rapid economic development. As a WTO member, promoting opening up actively and attracting foreign investment to accelerate market economy construction reflect the Chinese to adapt to the economic globalization and international division of labor initiatively. As China's services market more perfect and opening, China's attractiveness to foreign capital will be enhanced. The Chinese government has paid more attention to the development of service industry, because of its great role in the adjustment of industrial structure. The service industry and its internal structure has many problems, the paper will analyze the effects of FDI, and give reasonable proposal for the full use of FDI to the optimization of the service industry's internal structure.The paper has five chapters. The first chapter is the instruction of the article .This part described the research background and significance of articles, and research ideas and methods, and reviewed research on related issues at home and aboard. The paper used theoretical and empirical analysis. The final is the innovation and inadequacies of this article.The second chapter is mainly studied from the theoretical aspects. This part summarized the relevant theory on FDI and industrial structure adjustment as the theoretical foundation at the first. Because the definition of FDI and service industry is not uniform at home and abroad,the paper defined the two concepts as China's specific situation.And also, the author summarized the theories about the division of service industry. The first is Petty - Clark Theorem that with the raising of per capita income, the labor in the primary industry will transfer to the secondary industry. The further increase of per capita income will promote the labor to the tertiary industry. The proportion that tertiary industry in the national economy will increase as the income levels rising. The second theory is Kuznets's theory of structural transformation that the overall growth has close link with structural transformation and the proportion of industry and services increased is proportional to per capita output .The third is the theory of post-industrial society, the author of the theory thinks the post-industrial society is to serve the community. The final of the chapter is a detailed analysis of the effects of FDI including capital effect, technology spillover effect and correlation effect, these three effects create conditions for the development and optimization of service industry with capital, human and other aspects.The third chapter is about the China's development situation. Based on the above, the paper divided service industry into producer services, distribution services, social services and personal services. Then analyzed the four level services'added value and employment structure and found that the distribution services had high proportion. The article analyzed various industries of the 1991-2003 and 2004-2007 through chart analysis, and concluded that the distribution services'added value occupying a major position in China's service industry has not changed, but the financial industry, scientific research and comprehensive technical services on behalf of the modern service industry are developing rapidly, and provide intermediary services for the second industry .The situation will be improved. In terms of employment, the traditional service industry remains the main sector of absorbing employment, but employment structure is unbalanced. The development of producer services and distribution services need to be improved. Then the author summarized the FDI in the three industries. The proportion of foreign investment in services is less than the second industry, but the proportion has been rising. For various service industries, the real estate industry has the largest share, and the remaining part of the FDI mainly flows to the rental and business services and the wholesale and retail industry, and has less investment in the financial industry and science and technology and other emerging service industry.The fourth chapter is the empirical analysis. The added value of each service line is the explained variable, and the actual utilization of foreign capital and the lag period are explanatory variables. The regression model divided service industry into traditional service industry and modern service industry and test the effects of FDI on the two parts in the short-term and long-term. The results show that the regression results of modern service industry is more fitting, and both short-term or long-term. The impact of FDI on modern service industry is more significantly. In the regression process, the results show that regression results in the 2004-2008 term is more fitting, it implies as China's entry into WTO, the role of FDI is more and more obvious. Then, this article selects a few typical service industries such as transportation, warehousing and postal industries, wholesale and retail, financial services and real estate, regression analysis of these industries results show that although the real estate sector use the most foreign capital, the role of FDI is not obvious. Scientific research, technical services and geological prospecting industry, FDI is relatively small, but the effect is obvious. The leading role of FDI in transport and wholesale and retail sector has a lag.The last chapter is the summary of the full text. China is now at an important period of accelerating the development of he tertiary industry and the Chinese domestic and international environment has created favorable conditions that China should better grasp. In the progress, I think we should focus on several points: First, Improving the foreign investment legislation and regulations. China currently has more than 200 laws and regulations related with foreign investment, integrating the relevant provisions of induction is urgently needed to resolve; Second, improve the soft investment environment. This mainly refers to improving government efficiency, and creates a fair and just market environment; Third, guide the flow of foreign capital, focusing on the development of modern service industry, changing the way of absorbing foreign capital. |
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