Yunnan And The Gms Countries Foreign Direct Investment In Research

The Greater Mekong Subregion Economics Corporation (short for GMS) is initiated by the Asian Development Bank (ADB) in 1992, which comprised of six countries (or regions): Myanmar, Laos, Thailand, Cambodia, Vietnam and Yunnan, China (Guangxi was requested to join by China government in 2005), aiming to strengthen the economic relationship among the members, and promote the economic and social development. With the development of economic integration in GMS, intra-regional capital inflows continue to grow. FDI (Foreign Direct investment, hereinafter referred to FDI) no longer just inflows from developed countries in GMS, intra-GMS FDI among developing countries in GMS plays a important role in the alleviation of poverty, economic integration, infrastructure construction, as well as the dissemination of science and technology. Yunnan province as the second largest economy in this region is the main investor in GMS and also actively introduces the intra-FDI. Since 2001 the Multinational Corporations in Yunnan, China have accumulatively invested 273 million U.S. dollars, and also brought the funds, advanced management philosophy, as well as the technology to the sub-region, promote the economic development in GMS.This paper based on intra-GMS Foreign Direct Investment inflows to and outflows from Yunnan, China. Whatever the inflows and outflows, I will focus on the Yunnan province. My research suggest that, the FDI inflows from GMS countries has "Crowding-out" Effect on Yunnan's capital formation; These FDI promote the technological progress in Yunnan province by the relative productivity, however, the "Spillover" effect of the MNEs from other GMS countries is negative; Then I will construct a model to measure the absorptive capacity of FDI in Yunnan, the results say that the FDI from GMS countries is best with the human resources with primary education promote the economic growth in Yunnan. The last part of my research, I try to discover the reason why MNEs in Yunnan invest to the other GMS countries and the specific industries they invest by fieldworks and interviews, at last I will make policy recommendations through typical case studies.This research has four parts:Part One, My study will focus on the Yunnan as FDI inflows region. First I will study the current situation of intra-GMS FDI which inflows to Yunnan, and then conduct the research of investment effect, including the "Capital Formation" effect, "Technology Spillover" effect, and finally I will evaluate the ability of absorbing FDI. Because the span of data sample is short, I will use the regression tools and Granger causality test to solve the problems.Part Two, I will treat the Yunnan province as a FDI host in GMS region to study the FDI outflows, I will analyze the current situation of investment in GMS outflows from Yunnan, and then will discover the motivation of Yunnan's FDI outflows, then I will study three successful cases of Yunnan FDI to Myanmar: Yunnan Hongyu Corp., Yunnan Sida Industrial Ltd Co., Yunnan Kaiwei Industrial Ltd Co., suggest the barriers of Yunnan's MNEs and reviews the policy, lastly we provide the suggestions to other multinationals in Yunnan in the future.Part Three, Conclusions and policy recommendations, I will give the recommendation of the FD inflows to and outflows from Yunnan.