Foreign Direct Investment Selection Strategy

The acceleration of economic globalization has become one of the outstanding characters and trends in the present world, accompanied, at the same time, by the great growth of multinational corporations(MNCs) which excel themselves in both their enlarging number in quantity around the world and the more and more important role they play in the world economy.Studies has shown that a MNCs generally realizes its international management and spurs the economic globalization by three means: trade, contract, and investment, among which direct overseas investment is the most important one to expand itself overseas and achieve its international management. As a result, the MNCs has become the main generator of the economic globalization.As a developing country on its way to quicken economic development, China has to make good use of the borrowed power, help we can get from using foreign fund, technology and so on. The active use of foreign fund is one of the most direct and effective ways to borrow power. As the important position in the world economy, the investment of MNCs, on the other hand, has been one of the chief powers we can draw support from and an effective way for us to improve quality and level in foreign fund utilization. In this process, a rule must be confirmed that we must grasp the initiative rights of foreign fund utilization from the very beginning to the end. Active countermeasures can be taken to attract MNCs investment in China more reasonably and effectively only when it is understood by us what is their means, aims and strategies in direct overseas investment, what influences their choice, how they chose their means, and the benefits and shortcomings their investment bringing to the invested country.The analysis of when MNCs chose to directly invest overseas is helpful for us to improve investment environment and to set up the relative law and policy system accordingly, to enhance the combination of foreign fund with our national economic restructure and the reorganization and transformationof state-owned enterprises, to truly realize "for our use" in foreign fund utilization.At the same time, to carry out the opening-up strategy of Going Global is a very important measure in the new period of opening-up, when we not only open our market to foreigners, but also develop new overseas market. It is not fully opening-up to only attract investment or to export fund . "Attracting foreign investment" and "Going Global" are the two wheels of the opening-up which should start to move together.By seriously summing up and using for reference the management decision system of overseas investment taken by those famous MNCss, by following the rules that MNCss operate their companies internationally, and by integrating with the international market gradually, we are to build our own large MNCs, so as to make better use of markets and resources both at home and overseas.To realize the aims mentioned above, a systematic and overall discussion is conducted in the seven chapters of the essay, on the MNCs's strategic choice of means to invest overseas, on a decision-making model, built on the basis of factor analysis, of how the MNCss chose their means of direct investment, and on a case analysis of the French Vivendi Water investment in Baoji, which is to inspire and benefit Shaanxi Province in the carrying out of Attracting Foreign Investment and Going Global.