The Research Of Zhejiang Province’s Foreign Direct Investment Influence The Upgrading Of The Industrial Structure

As one of the first provinces opening to foreign, Zhejiang Province’s investment increased from dozens, millions to present more than1billion, investment area also started the limitations from southeast Asia into all over the world. the development of Zhejiang Province’s foreign direct investment always go ahead of other provinces in China. At the background of world economic environment remains weak and " Promote the upgrading of the industrial structure" policy, the study of Zhejiang Province’s foreign direct investment affect its industrial structure has a special significance. It can not only help us through the typical province to understand the relationship between foreign direct investment and upgrading of the industrial structure in east China area, but also provides specific empirical support for Zhejiang province’s decision-making and policy of foreign direct investmentThis paper utilizes the1986-2010statistics of Zhejiang Province and the techniques of VAR model, impulse response function and variance decomposition, and it divides the forms of expression for upgrading of the industrial structure into import and export structure optimization, the improvement of employment structure and the efficiency of domestic investment increases on the basis of studying the current situation of zhejiang province’s foreign direct investment, foreign direct investment necessity and the transmission mechanism of foreign direct investment influence the upgrading of the industrial structure. With all of these conditions, the paper makes an empirical study that how does the Zhejiang Province’s foreign direct investment influence the upgrading of the industrial structure.Research shows that Zhejiang Province’s foreign direct investment has a significant role in promoting the import and export structure and employment structure, as for the efficiency of domestic investment, foreign direct investment has a negative effect on it in the short-term, but in the long-term, foreign direct investment has a positive and sustainable role in promoting the efficiency of domestic investment. Generally speaking, Zhejiang Province’s foreign direct investment promotes the upgrading of the industrial structure.After concluding that Zhejiang Province’s foreign direct investment promote the upgrading of the industrial structure, this paper puts forward some relevant policy suggestions at the angle of government and enterprises according to current status and difficulties of Zhejiang Procince’s foreign direct investment, and hope that Zhejiang Province’s foreign direct investment gets better and better.