Research On The Impact Of Trade Facilitation On Inward Foreign Direct Investment In RCEP Countries

The signing of the Regional Comprehensive Economic Partnership Agreement marks the official establishment of the world’s largest FTA covering the world’s largest population,the most diversified membership structure and the greatest development potential.This agreement has important economic value and practical significance in eliminating regional economic and trade barriers,improving the trade and investment environment,deepening regional cooperation,and strengthening regional economic recovery,as well as sending a strong signal against unilateralism and trade protectionism,supporting free trade and maintaining the multilateral trading system.The signing of RCEP has brought new opportunities for trade,investment and value chain restructuring among member countries.As an active participant,main coordinator and important promoter of RCEP,the opening of RCEP has brought a new pattern of world development to China.This paper focuses on the impact of trade facilitation on attracting foreign direct investment(FDI)in the 15 RCEP member countries,and explores the mechanism,aiming to provide some empirical references for China in improving trade facilitation level and attracting FDI.It is found that the level of trade facilitation has a significant positive effect on foreign direct investment,and every 1% increase in the level of facilitation in the sample countries will increase the amount of foreign investment by 1.825%.In terms of sub-indicator regressions,all level indicators of trade facilitation have a positive effect on FDI at the 1% significant level,with e-commerce having the largest effect,followed by customs environment,rules environment and port efficiency.The heterogeneity study finds that trade facilitation has a greater effect on foreign investment promotion in middle-income countries than in high-income countries.In addition,the results are robustly tested by reconstructing the core explanatory variables,and the results show that the level of trade facilitation still has a significant positive effect on foreign direct investment.In order to avoid the endogeneity problem,this paper introduces two instrumental variables and uses the 2SLS method to conduct the endogeneity test,and the results also all pass the endogeneity test.Finally,the results of the mechanism test show that trade facilitation increases the inflow of foreign capital through two mechanisms: reducing transaction costs and improving the economic level.Here are the recommendations made in this article.Firstly,we should actively promote the cooperation and implementation of the Regional Comprehensive Economic Partnership Agreement(RCEP);secondly,we should optimize trade facilitation indicators and effectively promote the improvement of trade facilitation level;thirdly,we should strengthen the construction of value chains of RCEP member countries and deepen regional trade cooperation.