An Empirical Study Of Direct Investment Impact In Asean On Chinese Total Exports And Labor-intensive Exports

With the development of China-ASEAN Free Trade Area in recentyears, the investment scales and trade scales are gradually expanding. Butin the terms of exports trade structure, the main products exported fromChina to ASEAN are labor-intensive products. Actually it doesn’t meetChinese demand for optimization of exports industry structure. At the sametime, the direct investment from China to ASEAN gets a late start, theinvestment scale is small, and the investment direction is mainly to lowvalue-added industries. So how to expand the investment scale andimprove the investment level? How to increase the investment effect onexport trade? This paper will find the answer, through comparativeanalysis on the different investment effect to total exports andlabor-intensive exports.Firstly, this paper analyzed the impact mechanism of different foreigndirect investment to total exports and labor-intensive exports based ontheoretical study. This impact includes substitution effect and promotioneffect. Secondly, this paper did liner regression and error correction withthe datum from2003to2011. It aimed to do an empirical study on howChinese direct investments in ASEAN have effect on total exports andlabor-intensive exports. The results showed that Chinese direct investmentsin ASEAN have a promotion effect on both total exports andlabor-intensive exports in the long term, and the effect on labor-intensiveexports is greater than the effect on total exports. It means that currentdirect investment is against the optimization of exports industry structure.At the last, this paper found out the main problems of Chinese directinvestment in ASEAN through theoretical and empirical study, and gave some suggestion about how to improve current Chinese direct investmentin ASEAN.So to make Chinese direct investments in ASEAN expand Chineseexports and optimize Chinese exports structure, Chinese governmentshould encourage more SMEs to invest in ASEAN and support moreresource-seeking and technology-seeking investment. The government alsoshould improve the information service of Chinese direct investment inASEAN.