Research On The Location Selection Of China's Foreign Direct Investment Under The "Belt And Road" Initiative

Foreign direct investment(FDI)is an effective way for enterprises to exert their advantages,reduce costs,expand markets,transfer excess capacity and improve international competitiveness.China’s foreign direct investment started relatively late,but developed rapidly.By the end of 2017,it had leaped to the second place in global stock and the third place in world flow.After the "one belt and one road" initiative was put forward,it was also an upsurge of investment in the countries along the line.The first point of enterprises’ decision-making on foreign investment is location selection,which to a certain extent determines the risks and benefits of investment.Therefore,how to carry out location selection and analyze the influencing factors of location selection,it is an important practical issue for current academic research to consider the differences in Chinese enterprises’ choice of investment locations along the “Belt and Road” countries and non-“Belt and Road” countries.Based on location theory and foreign investment theory,this paper first analyzes the current situation of China’s foreign direct investment under the "one belt and one road" initiative.Secondly,based on the motives of foreign direct investment,this paper analyzes the factors and risks of location choice of China’s foreign direct investment in detail,such as host country’s market scale,infrastructure level,labor cost and strategic technology level,resource endowment,etc.Then,we use the investment gravity model to explore the relationship between these factors and the scale of foreign direct investment of enterprises.Finally,we give suggestions on the location choice of direct investment in the "one belt and one road" country and the non "one belt and one road" country.The study of this paper tries to enrich the location choice theory of FDI in developing countries,which is of practical significance for promoting the interconnection between China and the countries along the belt and road,adjusting the direct investment in the region along the line and the non-line countries,and guiding the Chinese enterprises to invest more efficiently.