The Analysis Of FDI Impact On The Undertaking Service Outsourcing In China

With the economic globalization and the development of the industrial restructuring, service outsourcing is developing rapidly. Because of the flexibility and cost advantage, it has been complimented by multinational corporations. From 20th century,80 years, "Do what you do best (core competence), the rest parts is outsourcing" has become the main strategic principle for multinational corporations to maintain core competence, also has become a irreversible trend. Service outsourcing has features as follows: six-high, two-low, two-less (six-high means high technology, high output, high added values, high capacity of absorbing employment, high international level;two-low means low input, low energy consumption; two-less is that less environmental pollution, less land resourcing).It is also known as "green engine" for the national economic development. Because service outsourcing has such advantages compared manufacturing, it gets the close attention from the developed and developing countries. Now many countries are busy with competing to undertake service outsourcing, so how to attract the attention from these countries becomes a concerned problem.In recent years, many scholars analyze the factors that can impact the undertaking from different angles, the main factors are the human resource situation, the degree of the infrastructure, the open of the service industry, the level of economic development and so on. As we all known, Chinese manufacturing make a remarkable achievement as taking advantage of FDI. Not only makes our country to become the world's manufacturing centre, but also brings economic growth for more than 20 years. Reading the service outsourcing research, and then find few scholars investigate it from FDI perspective.Therefore, the article tries to draw the experience of manufacturing in China, to analyze the impact on service outsourcing in China from FDI angle.This paper introduces the research background and significance, and then introduces the current research situation at home and abroad. The second chapter describes the theory review of service outsourcing and FDI in service industry, then explain the reason that multinational corporations concentrate on by using comparative advantage theory, core competence theory, on this basis, summarized the factors affecting service outsourcing. The third chapter uses empirical analysis, firstly score the factors that impact on undertaking service outsourcing through the gray relational analysis, then use relevant regression analysis, the conclusion proves that FDI is an important driving force to promote service outsourcing in China; The fourth chapter analyzes the current development situation of manufacture and takes advantage of manufacture FDI to develop service outsourcing of Chinese characteristic; The fifth chapter describes the history and situation that India takes advantage of FDI to promote service outsourcing, compares the different way to use FDI between India and China and learns experience from India; The last chapter puts forward relevant suggestions based on former analysis.This paper choose the data from 1999 to 2008, uses Eviews5.0 to take empirical analysis that affects the undertaking of service outsourcing, through the research we find that FDI is a important driving force to promote service outsourcing in China. Then, considering the new situation we are facing, putting forward some suggestions.