The Study Of Location Choices On China's OFDI In Countries Along "The Belt And Road"

With the economic growth of more than 10 per cent a year after the adoption of reform and opening policies,China's economic development has entered a new normal,meaning medium-to-high speed,superior structure and new power.Over the past three decades,we firmly have seized the strategic opportunities for development,but at the same time,it has been accompanied by a series of problems emerged,such as excessive foreign exchange reserve and overcapacity in some industries.Under this background,China unveiled “the Silk Road Economic Belt and the 21 st Century Maritime Silk Road” cooperation in 2013.The main goal of this cooperation is strengthening the infrastructure construction in the countries that along the “One Belt and One Road with our excess capacity,in order to achieve common development.In "One Belt and One Road" initiative,foreign direct investment is more and more important.There is an urgent need to analyze location choice tactics of FDI along the Belt and Road.According to the data shown in 2018 statistical yearbook of Chinese Bureau,China's direct investment to the countries along the routes has been rapidly developed since the Belt and Road Initiative was put forward.But,the distribution of China's OFDI is not even between different areas,and the Southeast Asia attracts most of the investment.Even in the same region,China's OFDI is imbalance of different countries.There are a large number of factors that result in disproportional foreign direct investment,such as the size of the market,trade volume,infrastructure and distance.This paper has set up a gravity model of investment with random effects which contains 53 countries from 2007 to 2017 to analyze the choice of location.The empirical results show that: The main factors of foreign direct investment by China are the GDP of China and the host country,the trade and the distance between China and the host country and natural resources of the host country.Only the distance between China and the host country holds back investment among the influencing factors.By regression result based on extended gravity model of investment,there is huge potential and great choice for investment.More concretely,Central,Eastern European and South Asia are the most promising and potential investment areas in the countries that along the “One Belt and One Road,meanwhile Southeast,South,West Asia and North African are giant magnetic field.On the basis of conclusion,this thesis puts forward some related policy propositions.