The Impact Of Foreign Direct Investment On The Performance Of Enterprises In China’s Agricultural Product Processing Industry

Combining the functions of primary and secondary industries,the agricultural processing industry is more efficient than agriculture alone and closer to people’s daily life than other processing and manufacturing industries,so its development has been widely concerned by all parties.Since 2001,the state will put forward some targeted policies for the agricultural sector every year,from these policies,we see the government’s attention to the development of the agricultural processing industry.With the economic growth of China’s agricultural products processing industry development rate continues to improve,agricultural products processing industry belongs to an important part of China’s agricultural economy,but from the data of the Ministry of Agriculture,theThe development of the agricultural product processing industry is still facing many problems.The problem of "double gap" of capital and technology has not disappeared,and the introduction of FDI plays an irreplaceable role in promoting the transformation and upgrading of agricultural processing industry.The most intuitive is that foreign capital can provide huge liquidity for the agricultural processing industry,and through the demonstration effect,the personnel flow effect brings high-tech and advanced management experience.In order to stimulate the positive impact of the competitive effect of FDI and improve the competitiveness of China’s agricultural processing industry,it is necessary to continuously improve the innovation ability of enterprises themselves and realize the transformation and upgrading of agricultural processing enterprises,which must focus on the improvement of the performance of China’s agricultural processing enterprises.Comrade Xi Jinping once said in the 19 th National Congress that in today’s new era,improving the ability of enterprises to operate efficiently is an important aspect of accelerating the conversion of the driving factors of economic growth.Therefore,China’s agricultural products processing enterprises must focus on the improvement of enterprise performance in order not to be eliminated from the market.This article focuses on the performance of agricultural product processing enterprises and analyzes the impact of foreign direct investment(FDI)on the operating performance of agricultural product processing enterprises in China.The article compares and analyzes the determinants of foreign direct investment and corporate performance,as well as relevant literature on measuring corporate performance.It also analyzes the theoretical mechanism of the spillover effect of foreign direct investment on corporate performance.Based on this,the article selects panel data from the China Industrial Enterprise Database for the years 1998-2014,with enterprise efficiency as the dependent variable,and the interaction between policy objects and policy time as the core explanatory variable.The article also uses asset-liability ratio,liquidity ratio,company size,R&D expenditure,employee training expenditure,and total asset growth as control variables.A difference-in-differences model is constructed to study the impact of foreign direct investment on corporate performance,and the conclusion is drawn that increasing foreign direct investment can promote the performance of agricultural product processing enterprises.Considering the differences in ownership and maturity of agricultural product processing enterprises,heterogeneity analysis is conducted,and the results show that FDI has a positive effect on the performance of non-state-owned and young enterprises in the agricultural product processing industry.Based on the research results,some relevant suggestions are proposed:Firstly,the agricultural product processing industry should not blindly expand its scale.Instead,it should focus on improving technological innovation,promoting the transformation of enterprises towards technology and management,and expanding production scale reasonably to increase enterprise performance.Secondly,the government should not only encourage or restrict foreign investment policies for the agricultural product processing industry.It should formulate targeted subsidy policies based on the characteristics of each industry.Lastly,although China’s agricultural product processing industry has a large quantity advantage,it has a relatively small scale.Therefore,it is necessary to absorb technology and operational management experience from the spillover effects of FDI,increase research and development investment,and form certain competitive advantages.