The Research Of FDI On The Impact Of Anhui Industrial Structure

Foreign Direct Investment (FDI) is acknowledged as the most significant and attractive way of taking advantage of foreign capital for developing countries,as it could supply capital as well as modern technology and management experience for those. As a province locating in inner China, Anhui province lacked geographic advantages which could be easily obtained in coastal developed ones. Anhui province has sped up to open up and made use of FDI in recent years, which was highly encouraged by Chinese government. Moreover, economy in Anhui province rapidly developed and FDI availability highly increased. Promoting its fast growing, FDI became more and more important for economy development in Anhui.However, because of the consequence of its relatively low economy developing level and the tendency to pursue profit of FDI, FDI made bad effect on the economic construction. Most foreign capital concentrated on secondary industry, resulting in development coordination and structural deviation of the three industries. The purpose of this paper is to investigate how to improve the utilization efficiency of FDI and take advantage of the positive effects mostly, and also make discussions on how to enlarge the scale of FDI and develop economy rapidly in Anhui province.The first part introduces research background, significance, methods and main contents. Potential innovation and inadequacy are also given in this sector. This sector also summarizes the researches on the effects on industry structure of FDI at home and overseas.The second part reviews theories about effects on industrial structure of FDI. In this sector, the author mainly introduces Flying Geese Paradigm, Shortage Model, Product Life Cycle Theory,Growth Phases Theory. Positive and negative effects on the economy of the host nation are also discussed.The third sector introduces the industrial structure and developing history of FDI in Anhui province. The fourth chooses the secondary industry as the starting point and builds a empirical,basing on the secondary industry data of Anhui Province and Jiangsu Provine to measure the impact that FDI works.The results show that:FDI promotes the second industry in Jiangsu Province and Anhui Province,but the degree on Anhui Province seems lower.Meantime,Jiangsu faces with construction Transition when FDI in the secondary industry could reduce.The fifth discusses detailedly the reason why Anhui province falls behind coastal provinces in economy development. As contrast, Shanghai is analyzed which is of high industry developing level to show the shortcomings of Anhui.The sixth proposes ssome suggestion, based on the previous analysis, on how to overcome the shortcomings and increase the scale and positive effect of FDI.