The Analysis Of Effect On Sino-South Korea Trade For South Korea FDI To China

Globalization encourage each country to take part in the international division and make use of the each one's advantage . Globalization also stimulate each country to make use of others' advantage to enhance themselves at the same time. Every country could combine their advantage with others' advantage depending on FDI. FDI combine two countries' advantage and promote the development of bilateral trade. FeiNon pointed FDI of mother-nation promote the development of im-export .The cost of product become the vital factor when production becomes standard. Mother-nation invests in low-cost country beyond the FDI and utilizes the home-country's labor, then sell the products to mother-nation and international market. Although China and South Korea build the formal diplomacy relationship in 1992, the bilateral trade has been lasting for very long time. South Korea began invest in China through HongKong and Japan in 1980s.FDI from South Korea to China is increasing after 1992 when two countries build the formal diplomacy relationship. Because the increase of FDI, bilateral trade also began to increase and exceed 100 billion US dollars. FDI from South Korea affect bilateral trade greatly, some effects are positive, others are negative. FDI from South Korea enlarge the volume of bilateral trade and enhance the competition of two countries' export, promote the structure of bilateral trade, but also cause the imbalance of bilateral trade .The paper introduce the current situation of bilateral trade and FDI from South Korea at first. Then the paper began analyze the effect of FDI from South Korea on bilateral trade. At first the paper analyze the positive effect of FDI, next analyze the negative effect. Later the paper makes prospects of development of FDI from South Korea. At last the paper make several ideas on how to make well use of FDI.