The Influence Of Japanese Direct Investment In China On Sino-Japanese Trade

Since reform and opening, China has been drawing the foreign capital withbigger strength and better capability, and has been a crucial investment object toJapan, one of the biggest outward investment countries. By the "flying geese model"of Kaname Akamatsu and PROT-FDI of Kiyoshi Kojima, the factors of the Japanesedirect investment in China and its status quo are presented：Intrinsic motivationincluding ownership advantages, internalization advantages, location advantages;extrinsic motivation is mainly China Japan provides labor cost advantage, openmarkets and transparent and fair policy. The Japanese direct investment in China haspositive influence on Sino-Japanese trade, On the one hand, the Japanese directinvestment in China benefits the steady increase of the Sino-Japanese trade amount;on the other hand, it also improve their trade structure, and improve China’s exportenterprise and its international competitiveness of export commodities. Japanesedirect investment in China is still in the manufacturing end of the field,fornon-manufacturing sectors is generally used for the manufacturing services; Japan’sdirect investment in the area covered is generally concentrated in the southeastcoastal economically developed areas, less involved in the western region, but in thefuture have a greater investment prospects In order to further attract the Japanesedirect investment and increase the economic growth in China, some steps should betaken including correctly understanding the direction of foreign capital, improve thetechnology of using foreign capital, creating and improving the investmentenvironment to attract foreign capital.