Study On Home Country Carbon Effects Of OFDI

According to the World Investment Report 2021,China has become one of the world’s largest OFDI outflows,with a cumulative share of over US$133 billion by2020.This shows that China has an important position in the international investment arena and plays a positive role in global economic development.This is also the result of China’s continued reform and opening up,and the strengthening of international cooperation,and it is believed that as China continues to grow,its influence in the global investment market will increase.China’s non-financial foreign direct investment in countries along the Belt and Road Initiative grew by 18.3%year-on-year to US$25.54 billion,a rate far faster than that of other regions.However,as Chinese investment in countries along the route continues to grow,it may be necessary to take into account changes in underlying demand factors and the negative impact this may have on the ecological environment.One of the most prominent issues is the risingCO₂ emissions.According to statistics,in 2006,China’s carbon emissions were ranked for the first time in the world as the largest emitter ofCO₂ in the world,surpassing the US,a record that continues to be set today.As a result,China has made efforts to develop a low-carbon economy and promote low-carbon living in recent years,and the growth ofCO₂ emissions has gradually slowed down.Despite this,China is still under enormous pressure to reduce its carbon emissions.In the course of the country’s development,it is evident that environmental pollution is still a serious problem in China,the natural ecological environment has been severely damaged and atmospheric pollution has increased,such as the hazy weather we often hear about,which has a great impact on people’s health and life.The construction and development of the"One Belt,One Road"has led most countries to wonder whether we are seeing the countries along our investment routes as"pollution havens",relocating our energy-intensive,environmentally polluting and non-friendly manufacturing industries to other regions.A comparison of references shows that most studies have focused on the environmental impact of OFDI in developed countries,while relatively few studies have looked at OFDI in developing countries.Most of these studies focus on the host country,but rarely explore the extent of the environmental impact on the home country,the country from which the investment flows.On the other hand,the literature on the environmental dimension of the Belt and Road is very limited.To this end,this paper intends to study the impact of China’s manufacturing outward direct investment in countries along the Belt and Road on China’s ecological environment,and tries to answer the following questions:Is China taking advantage of the"Belt and Road"to Is China taking advantage of the"Belt and Road"to transfer polluting industries along the"Belt and Road"?Is there a"pollution sanctuary"in China?What is the impact of Chinese OFDI on environmental pollution in neighbouring regions?How does OFDI in manufacturing to countries along the route affect China’s carbon emissions?Firstly,through a systematic review of relevant literature at home and abroad,we explore the mechanisms and paths of China’s manufacturing OFDI on carbon emissions from three dimensions:"scale","structure"and"reverse technology spillover"based on the perspective of home countries.The project also aims to establish a panel co-efficient model to more accurately assess the impact of OFDI on carbon emissions and provide a scientific basis for the transfer of export-oriented industries.Secondly,this project aims to test the"pollution refuge"theory in 30provincial capitals in China from 2005 to 2020,and combine the OFDI,carbon emissions and fixed capital investment of industrial enterprises in 30 provincial cities from 2013 to 2020.We also test the theory and the model by combining data on outward foreign direct investment,carbon emissions and fixed capital investment of industrial enterprises in 30 provincial cities from 2013 to 2020.Finally,we conduct a decomposition analysis of the home country carbon emission effects of Chinese manufacturing OFDI,and propose targeted policy recommendations to help China achieve its energy saving and emission reduction goals.The results of this paper show that:（1）from 2005-2012 to 2013-2020,i.e.before and after the implementation of the"Belt and Road"initiative,there is no significant difference in the effect of manufacturing OFDI on carbon emissions.The coefficients only change partially,indicating that there is no"pollution sanctuary"in China.（2）Chinese manufacturing enterprises’OFDI has a positive impact on domestic carbon emissions,indicating that the higher the number of domestic industrial enterprises’OFDI,the higher their carbon emissions.After analysing the carbon emission equation in the joint cubic equation set,it can be found that OFDI affects domestic carbon emissions through three kinds of spillover effects:scale effect,structural effect and reverse technology spillover effect.Among them,the scale effect and structural effect are positive,the reverse technology spillover effect is negative,and the combined effect of the three transmission pathways is positive.（3）Heterogeneity analysis was conducted for the three regions of the East,Central and West,and different regions presented different results of the effects.For the economic scale effect,the relationship between the eastern and central regions of China is basically the same.However,the western region has not yet felt the obvious driving effect of foreign direct investment on economic development.In terms of industrial structure,the impact of OFDI on the eastern and western regions of China was largely similar,but the greatest impact was felt in the eastern region.In the central part of the country,the share of the secondary industry did not decline.In terms of technology effects,there are significant regional differences,with the effect of OFDI being better in the east and central regions than in the west,and regional differences in the technological progress driven by OFDI.Overall,the regression results for the eastern region are closest to those of the full sample,while the differences are most significant in the western region.This may be due to the slower pace of OFDI development in the western region.