Foreign Direct Investment Impact On The Export Of Mechanical And Electrical Products

Since the reform and opening up, Zhejiang province has made significant achievements inattracting foreign direct investment(FDI), and the FDI that Zhejiang province has attracted andused shows a general trend of increasing, some of it flows into the electromechanical industry, sothe using FDI of the electromechanical industry of Zhejiang also shows a general upward trend.At the same time, the export trade of electromechanical products of Zhejiang province gets rapiddevelopment, and the export scale and export competitiveness of mechanical and electricalproducts have gained rapid development. According to theory and empirical research about therelationship between FDI and international trade from the domestic and foreign scholars, FDI hasalternative or complementary effect on international trade. Special to the actual development ofZhejiang province, what the effect from the FDI will happen on the export trade ofelectromechanical products of Zhejiang province? Whether alternative or complementary effectwill also occur? Based on the thinking of these issues, this article uses several econometric analysismethods to empirical analysis the effect from FDI on the export scale and export competitivenessof mechanical and electrical products of Zhejiang province.The idea of this article is as follows: firstly, descript briefly the background、meaning、research methods、the main content、existing innovation and difficulty and so on; then sort out andreview the theory of foreign direct investment and the theory empirical research on the relationbetween the FDI and international trade; secondly, do the related theory of foreign directinvestment as a guide, and on the basis of learning and absorbing the results of previous studies, tryto qualitative analysis the effect from the FDI on the export trade of host country; thirdly,quantitative analysis the develop status of attracting and using foreign direct investment and exporttrade of electromechanical products of Zhejiang province; and then use such methods as thecorrelation analysis、VAR model analysis、cointegration、Granger causality test、Error correctionmodel and so on to empirical analysis of the effect from the FDI on the two aspects of export scale and export competitiveness of electromechanical products of Zhejiang province; finally, get someconclusion and analysis the reason of conclusion,and then make some corresponding suggestion.In this paper by combining the qualitative and quantitative analysis found that FDI has apositive impact on the export scale and export competitiveness of electromechanical products ofZhejiang province, that is to say, the expand of the scale of foreign capital promotes thedevelopment of export trade of Zhejiang province’s electromechanical products. At the same time,according to the conclusion and, give some corresponding suggestion in order to attract and useFDI better and to further promote the development of export trade of Zhejiang province ‘selectromechanical products.