Empirical Research On The Motivation Of China’s OFDI To The Europe Union

Following the implementation of the so-called Going Abroad strategy, Chinese outward foreign direct investment(OFDI)maintained rapid growth. Although our main trade partners are developed countries, we do more in developing countries than developed ones on the stock of foreign direct investment(FDI). European Union(EU) is such a typical example. The EU is Chinese largest trade partner in 2012, yet the outward foreign direct investment(OFDI)stock from China to EU is not less than 6% of our total overseas investment. China is in the phase of economic transition that needs to develop high-tech to promote our industrialization progress. There is an open market, world class technology and brand and design ability of industrial products in EU. So EU is the better choice to gain overseas technology. It provides an opportunity for us to buyout EU’s technology and brand with lower cost that the European debt crisis leads to the devaluation of European assets. Thus, it’s a very important strategic significance to Study on the issues related to direct investment in Europe on the improvement of Chinese industrial structure.Under the background of European debt crisis, this paper finds that motives of FDI can be basically characterized into market-oriented, resource-oriented, technique-oriented and productivity-oriented by combing relevant literatures, which keep consistent in the theory of motives of FDI of John H·Dunning. That provides a theoretical basis for this article. The report of Chinese investment to EU studies the investment motivations from China to EU through questionnaire survey of mainland Chinese companies which invest in EU at least once. That provides relevant factual basis. Later, the results in the report will be divided into the four kinds of investment motives to make a qualitative analysis, which will be mainly prepared for empirical index selection.This paper uses data from 27 countries in EU during 2003 and 2012 to do empirical study according to the results of theoretical analysis. The result shows that the main motive of Chinese direct investment to EU is market-oriented and the others are not significant factors before quoting dummy variable about European debt crisis. After quoting that dummy into the model, the motives of resource-oriented and productivity-oriented are still insignificant, but the influence of the variable of technique-oriented on Chinese investment in EU is remarkable and positive, that means the main motives are market-oriented and technique-oriented. From what has been mentioned above, European debt crisis provides an opportunity for us to access to strategic assets from EU which would facilitate development of technology and improvement of industry in China. At last, the paper puts forward some policy recommendations for Chinese FDI in EU from perspective of government and enterprises.