Research On The Location Choice Of China’s Foreign Direct Investment

With the rapid development of economic globalization and the rapid development of multinational corporations,foreign direct investment(OFDI)has become the main way of the world economy.After the 1970 s,developing countries began to invest in foreign direct investment by learning,and achieved rapid development.They have an increasingly important position in the international investment.China’s foreign direct investment enters a period of rapid development from the initial period.The growth rate of 2002 to 2015 reached 35.9%.In 2014,China’s foreign direct investment flows ranked third in the world,two-way investment close to balance for the first time;foreign direct investment stock ranked eighth in the world and entered into the world’s top 10 ranks for the first time.In 2015,China’s foreign direct investment amounted to 145.57 billion US dollars,achieved rapid growth for 13 consecutive years,ranked second in the world for the first time.The study of the location choice of China’s foreign direct investment will help to improve the scientific nature of overseas investment strategy,making the pattern of foreign direct investment more reasonable.The paper briefly introduces the theory of location,the theoretical basis of foreign direct investment in developed countries and developing countries.Then we analyze the factors influencing the investment location of host countries,investors and enterprises from the theoretical point of view.We systematically analyzes the status of China’s foreign direct investment in investment scale,industry distribution and regional distribution,and reveals the main problems of the distribution of foreign direct investment in China.Then we use the method of factor analysis to study attractiveness of China’s foreign direct investment target countries;use panel data regression model to study the factors impact to foreign direct investment.Finally,Finally,we put forward countermeasures and suggestions to location selection.Through the analysis of the attraction to foreign direct investment target countries,four types of foreign direct investment are obtained: technology seekingtype,market seeking type,resource seeking type,technology and trade tendency type.This paper chooses the market size,market potential,resource endowment,technological endowment,infrastructure,trade volume between the two countries and the degree of economic opening as the important influencing factors of China’s foreign direct investment.The empirical analysis concludes: The most important influencing factors of technology-seeking OFDI are technological innovation.The main influencing factors of the market-seeking OFDI are the market size.The most important influencing factors of resource-seeking OFDI are the resource endowment.The overall investing strategy in investment locations is to consolidate and expand investment in developing countries,enhance investment in developed countries and maintain direct investment in trade-related areas.Government level: to strengthen the government’s macro-control,improve foreign direct investment laws and regulations,establish and improve the risk prevention mechanism.The enterprise level: The investment motive and the investment location should be combined.The enterprise should strengthen the research on the investment environment of the target country,and enhance the competitiveness of foreign direct investment.The association level: one is to come forward chamber of Commerce and other non-profit institutions by the semi-governmental Association,set up offices in major countries and regions,collect all kinds of important information;two is to establish the operating mechanism of joint ownership mechanism by foreign investment enterprises and related units,provide funding,information,marketing and other aspects of support and service.