Study On Influence Of South Korean Foreign Direct Investment On Economic Development Of Dalian

With the further development of economic globalization, the world’s economic interdependence and economic cooperation in East Asia are also increasingly accelerating. After the growing openness in East Asia and the volume of trade, China and South Korea hold the balance of trade cooperation. Especially Park Geun-hye following the first visit to China in June2013, South Korea and China greatly accelerated the establishment of the FTA, which further reduced the trade barriers between the two countries and strengthened strategic cooperation in related fields. AT the same time, the two parts also achieve mutual benefit and further promote the prosperity and development in Northeast Asia. Dalian, one of the first national open city determined by the State Council, has strong economic complementarities, the regional advantages, human and economic advantages to attract a large number of foreign companies to invest from South Korea. Since the1990s, along with China and South Korea established diplomatic relations, South Korea and Dalian economic and trade cooperation has been greatly developed, and achieved remarkable results. According to statistics in2011, Korean investment projects in Dalian approved are54.The actual use of Korean FDI is$886,620,000and the total imports and exports has reached$5,141,050,000, which was the third largest source of investment after living in Taiwan and Japan. South Korea has played an important role for Dalian in economic development and opening wider.At the same time, Dalian also provide a huge market and greater space for the development of many Korean companies. Therefore, the mutual trade relations of two parts is becoming more and more important and deepening economic cooperation between the two places plays a great important role. In this paper, the author take Dalian, this particular area City as the research object and adopt the empirical analysis method to analyze the various aspects of economic development on Korean foreign direct investment which overcomes the general conclusions against the study of the of one country. And these conclusions have limited references for the local government. We can also avoid some one-sidedness according to one single side. This paper is divided into seven parts:The first part is an introduction, including the background and significance of the topics, literature review, research methods, structural framework and the paper’s innovation and inadequate. Literature review consists principally of foreign direct investment in other parts of China and South Korean direct investment in Dalian, which provides a reference for ideas and models.The second part include stage of development, the scale of development, industrial distribution, characteristics and trends of South Korean direct investment in Dalian, which lay the foundation for empirical analysis below. In this paper, because South Korea’s investment in Dalian has reduced caused by the worse of external environment, the author takes1998and2008as node to divide the paper into three stages, and then analyzes investment status of each stage. Through the analysis of Korea Investment, we know Korean FDI in Dalian is mainly dominated by manufacturing-based secondary industry.The third part adopts empirical analysis method to explore the Import&Export influence of South Korean direct investment in Dalian. The empirical results of Dalian Import&Export influence show that South Korean investment in Dalian can drive an increase in the amount of import and export, and has the similar degree between the two. However neither of them passes the Granger causality test and it shows that South Korea’s investment in Dalian is the indirect cause of the increase of Import&Export, rather than its direct cause.The fourth part adopts empirical analysis method to explore the Dalian capital formation influence of Korean investment in Dalian. The empirical results of Dalian capital formation influence shows that South Korean investment in Dalian can drive an increase in the amount of capital formation and promote the fixed assets.The fifth part adopts empirical analysis method to explore the Dalian technological progress impact of Korean investment in Dalian. The empirical results of Dalian capital formation influence shows that South Korean investment in Dalian can promote the technological progress in Dalian. Besides the direct and indirect effects are positive and indirect effect is much larger than direct effect.The sixth part adopts empirical analysis method to explore the Dalian economic growth influence of Korean investment in Dalian. The empirical results of Dalian economic growth influence shows that Dalian is export-oriented economy and Korean investment plays a role in promoting economic development.Part VII, according to the foregoing empirical results, the part reaches some corresponding conclusions.Besides, this thesis proposes appropriate policy recommendations in order to avoid the problems of Korean investment in Dalian and enhance the role of South Korea on the development of Dalian.