The Development Of China’s Direct Investment To Africa And Its Causal Analysis

China’s outward FDI has been increasing sharply in recent years with the dramatically increasing of economic globalization and Chinese economy. At the same time, since the 21st century, African economy has a rare stable economic development. What’s more, Africa is rich in resources and has huge market potential. At present, there are many researches about foreign investment absorbed by China. However, there are few studies on China’s outward foreign direct investment, especially the studies of direct investment in Africa. FDI outflow from China has been increasing rapidly and Africa becomes new hot spot for international investment Thus, it is necessary and meaningful to combine these two together. This article analyses China’s outward FDI in Africa. Then this article will study the different scales of FDI in Africa and resource utilization between China and developed countries. This article denies that China’s plunder of resources in Africa. This article analyzes the reasons for China’s direct investment in Africa and this is the key point of this paper. Through qualitative analysis, we find the reason for China’s market-seeking outward FDI in Africa:the huge market and the great potential of African countries, outward FDI in Africa can help China to achieve the transfer of the industrial structures, the African market has a high return rate on investment. China is lack of resources and highly depended on imported resources. However, Africa is rich in resources. Thus another important reason for China’s outward FDI to Africa is resource-seeking. Finally, this article use African countries as the sample to do the empirical analysis, the empirical analysis verifies the contents of the previous qualitative analysis and get the conclusions that the reasons for China’s outward FDI in Africa are both market-seeking and resource-seeking.