The Analysis On The Trade Effects Of China’s FDI To Countries Along "One Belt And One Road"

The "Belt and Road" initiative is one of the most important strategic plan for China’s foreign development since the reform and opening-up policy.Now,and even for some time in the future,it will certainly become the focus of China’s economic and trade cooperation.Compared with the developed and mature European markets and the backward African markets,the markets of the countries along the "Belt and Road" have the characteristics of stability and growth,and have great potential for development and exploration.At present,China’s economy has entered into the new normal,development rate tends to slow.The growth rate of foreign trade has slowed down,the demographic dividend has disappeared,the comparative advantages of labor-intensive industries are no longer obvious,and the problem of overcapacity is serious.Demand for minerals,oil,gas and other sources of energy is growing,and China’s foreign trade is in urgent need of new impetus for growth.In view of the previous studies on the relationship between FDI and trade,this paper explores the trade effects of China’s foreign direct investment to countries along the routes from the perspective of "Belt and Road".Combined with theoretical analysis and empirical analysis,this paper probes into whether it is possible to expand the scale of China’s foreign trade by promoting investment in the countries along the routes,optimize the industrial structure of our country and at the same time promote the common development of the economies of the countries along the routes.In this paper,we first sort out the related research on the trade effect of foreign direct investment trade at home and abroad,and on the basis of this theory,we discuss the transmission mechanism of the trade effect of foreign direct investment according to the type of investment.Secondly,it explains the status quo of China’s outward direct investment as well as foreign trade in countries along the "Belt and Road" detailedly,including the scale and growth rate of outward direct investment and foreign trade,regional distribution,and industry distribution,etc.Emphasis is placed on the spatial differences between investment and trade.Through the comparison of investment and trade-related data,it is concluded that China’s direct investment in countries along the "Belt and Road" route will have a positive impact on China’s foreign trade.Thirdly,carry on the empirical test.Collecting panel data from 56 countries along the "Belt and Road" route from 2009 to 2017 to build a trade gravity model,and conducting regression analysis from two angles: export and import.The results eventually show that the effect is positive,and the effect is more obvious in the long run.Meanwhile,market size of countries along the “Belt and Road”,labor status and trade facilitation level of the host country are positively related to the creation effect,while the natural resource endowment is negatively correlated.Finally,based on the status quo and empirical results of the previous paper,the conclusion of this paper is summarized,and policy recommendations are put forward from the national level and the enterprise level: at the national level,the government should strengthen macro-control,optimize the investment environment,and improve the service security.Reduce the obstacles faced by the enterprises,and help enterprises to avoid risks;At the enterprise level,enterprises should seize the opportunity,invest rationally,improve the competitive advantages and anti-risk ability,maintain the sensitivity to the market,and implement the differential investment strategy.