Impact On The FDI Scale To Our Economic Security And The Demonstration Analyses

The economic security of our country is an integral part of national security, and also is an extension and development. Economic security plays a fundamental role in the area of political, military and economic which is the most important area. The introduction of foreign direct investment in the history brings us lots of successful experiences and the lessons of failure. The most important thing is to control FDI under a moderate scale based on our own national conditions.Since the beginning of the 1990s, due to the continuous improvement of China's investment environment, political stability, sustained economic development, rapidly expanding scale of foreign investment, by the end of 2005, it has reached 60.3 billion U.S. dollars in FDI. Large inflows of foreign direct investment to China's economic growth will undoubtedly play a major role. However, in the current circumstances, the appropriate size of foreign investment should draw our attention so as to avoid blind investment-attracting the negative impact of economic security.Therefore, the purpose of this paper is to study how to maintain an appropriate level of capital so that economic security will not be affected; how to define the appropriate scale. The method is combination of theoretical and empirical, qualitative and quantitative. Firstly, I introduced the model of "Harrod-Domar" and "revenue-cost" theory. The next to analyze of foreign direct investment relations with the host country's economic security, including financial security, industrial security, markets security and natural resources of host security. Then apply a qualitative analysis of FDI to China empirical analysis of appropriate scale, and reach the result that the scale of the import of FDI in China is more than modest size. As of the end of October 2006, China's direct foreign investment amounting to 48.576 billion U.S. dollars, compared with last year, an increase of 0.34%, according to the growth rate, China's FDI in 2006 over the scale of appropriate scale. Finally, I apply squeezing in and out principles of economics, to draw conclusions and give policy recommendations include increasing the nation's competitiveness and the competitiveness of enterprises, so as to avoid the country's economic security is being threatened.