The Study On The OFDI And Industrial Upgrading In Shandong Province In The Belt And Road Strategy

In September 2013, President Xi Jinping proposed "the Silk Road Economic Belt"during the visit to the Central Asian countries. And in October, the President also proposed "the 21 st Century Maritime Silk Road” during his visit to Southeast Asian countries. Every province in China is eager for a fight, looking forward to bringing new economic growth point with the Belt and Road Strategy. Shandong province is no exception. After "the Going Out Strategy" which was proposed in the beginning of the21 st century, the Outward Foreign Direct Investment in Shandong province has developed rapidly. Whether the stock of investment or investment flows are showing an increasing trend. While Shandong Province is in a critical period of industrial restructuring and has heavy industry, the task is heavy for Shandong Province. Seven industries have overcapacity such as steel, iron, coke, lead-acid batteries and so on.Therefore, the serious problem is how to using Outward Foreign Direct Investment to promote industrial transformation and upgrading and complete the task of production capacity. This paper discusses the relationship of Outward Foreign Direct Investment and Industrial Upgrading in the Belt and Road Strategy.This paper concludes six chapters. The first chapter is introduction. It mainly includes the research background and significance, research content and research methods, innovations and shortcomings. The second chapter combines the domestic and abroad literature from the Outward Foreign Direct Investment promoting Industrial Upgrading and the Outward Foreign Direct Investment in the Belt and Road strategy. The third chapter analyzes the present situation of the Outward Foreign Direct Investment in Shandong province and the present situation of internal structure of each industry in Shandong province. The status of Foreign Direct Investment is analyzed from the overall situation of the foreign direct investment in Shandong province and the present situation of Direct Investment to the countries in the Belt and Road Strategy. The analysis of the industrial structure has also been further to the analysis of the internal structure of each industry. Although the industrial structure of Shandong province has been optimized, butthere are still some issues such as the internal structure of he industry is not coordinated,resource bottlenecks, overcapacity and so on. The fourth chapter makes the theoretical analysis from micro and macro perspectives. The fifth chapter makes empirical analysis using Chenery standard structure and modified vector autoregressive model. The empirical results show that the Direct Investment to the countries in the Belt and Road Strategy in Shandong province has positive impact on Industrial Upgrading. It also has a high degree of contribution. The sixth chapter is the relevant policy recommendations and conclusion. The policy recommendations are about how to using Foreign Direct Investment to promote Industrial Upgrading in the Belt and Road Strategy. At last I summarize this paper and propose the further research direction.