The Empirical Research On Resolving Processing Overcapacity Through The "Go Out" Strategy

After the outbreak of the financial crisis,the global economy went into the pattern of slow growth and associated with the long-term risk of stagnation.The market expectations of the Federal Reserve meeting on interest rates continued falling.Besides,the Euro area as a whole seemed crisis-ridden after the British left the EU.China's situation is not optimistic too,the problem of overcapacity reproduced in 2012,especially in the steel industry.The past year China's iron and steel industry losses 649 million yuan.It is the worst year in the history.Overcapacity has become serious obstacles to the enterprise's benefit and the economic development.To solve the problem,China's central economic work conference regarded "to cut excess capacity" as one of the five tasks of supply side reforms in 2015.In February 2016,the State Council issued "the view on the iron and steel industry to resolve the excess capacity to realize healthy development and extricating from predicament ",aims to promote the iron and steel industry supply side structural reform,lower crude steel production capacity.Under these circumstances,how to resolve the excess capacity in China is one of the urgent problems to be solved at present.The four sector economy is an open economy.In 2013,China's government considered comprehensive international and domestic market and put forward "The Belt and Road" strategy."The Belt and Road" is a best strategy in our new round of Opening-up strategy.It is based on the principles of "to discuss,to build and to share"and aiming at optimizing the allocation of global resources so that each country can participate in the implementation and realize development of their own society and economy.At the same time,It builds the foundation for deepen the "Go out" strategy and providing a huge international market for the transfer of excess capacity.Therefore,the analysis of "The Belt and Road" has important practical significance to resolve the overcapacity contradiction.The essay draw lessons from the ideas of how the developed countries in the world transfer overcapacity outward,we consider the implementation of "The Belt and Road" strategy can also have the same effect.First of all,the essay analyzed the status of our country's overcapacity,mainly for steel,cement and shipbuilding industry and its industry association effects,pointed out that the industrial transmission mechanism based on the industry association can generate pull effect and propulsive effect between upstream and downstream industries.Through the analysis of the scale and industry association of "The Belt and Road"project investment,we found that these construction project investment play a great role in consuming the products of overcapacity industries.Secondly,the essay made a deep analysis in the mechanism that why "The Belt and Road" strategy could resolve the problem of overcapacity.First,"The Belt and Road" provides a feasible way for the industrial transfer between the industrial poor countries and other countries.Second,"The Belt and Road" is conducive to promote trade and investment facilitation and the bilateral trade of China and other countries,especially to reduce barriers to the flow of production factors.Third,the win-win concept of "The Belt and Road" can be accepted by many other countries,because it is in accordance with the their own interests of development.Based on the above theoretical analysis,the paper finally verified the resolving function of overseas investment and project contracting to overcapacity in using the method of empirical analysis,and put forward some policy proposals to the "The Belt and Road" strategy's implementing from external and internal aspects.The possible innovation of this paper is that it selected the steel industry finished goods inventory year-on-year growth rate as an alternative variable,and made the quantitative analysis the function of overseas direct investment and overseas project contracting to overcapacity under the background of "The Belt and Road".The empirical research verified the resolving function of overseas investment and project contracting to overcapacity contradiction.The situation of overcapacity is grim,transferring overcapacity outward to alleviate domestic overcapacity contradiction with "The Belt and Road" opportunities will not only from the theoretical perspective,but need more empirical analysis to prove.The inadequacies of this article lies that the description of the extent of overcapacity is not not comprehensive,because the data we use is the monthly data and our country's industry data collection is limited.So we can not use the capacity utilization rate,the core indicators to embodied the degree of excess.We can only use the iron and steel industry finished goods inventory year-on-year growth rate to replace,that influenced the results of empirical analysis to a certain extent.The essay is divided into five parts.The first part is introduction,it contains the background and significance,describes the related research,and the paper's framework and possible innovations and deficiencies.The second part mainly introduces the definition of related concepts and theoretical basis.The third part mainly introduces our country's overcapacity status and the classification and scale of "The Belt and Road" investment project.Besides,it analyzes the industry association and describes the resolving mechanism of "The Belt and Road" to the overcapacity.The fourth part analyses the relieving function of overseas investment and project contracting to overcapacity through the empirical research.The fifth part makes a summary and puts forward some suggestions about the implementation and improvement of "Belt and Road Initiative".