subject: Foreign Investment Gathered In Eastern China [print this page] Foreign investment has the important role of promoting in the national economy, since the reform and opening up, China begun to attract foreign investment with various measures. In recent years, China has become the second largest foreign investment country after the United States. Only in July of this year, 1972 foreign-invested companies have established in mainland China, the actual use of foreign investment (FDI) is 75.8 billion U.S. dollars.
Foreign investment is more in Eastern than in Western
Due to differences in geographical location, resource conditions and the quality of personnel, foreign investment is higher in eastern China and lower in western China. In other words, foreign investment gathered in the eastern China, the numbers of foreign-funded companies in Guangdong, Shanghai, Jiangsu, Zhejiang, Fujian, Shandong, Beijing and Tianjin are more than in the west provinces of China.
The reasons for this phenomenon are manifold, in addition to the opening policy of gradient advancing from the east to central and western and the preferential investment policies for the eastern regions, good basic infrastructure, strong research and innovation capacity, a relatively mature market economy and much better hardware and software environment than in the central and western regions are the important reasons for the difference of the eastern and western regions.
In addition, relative to the central and western regions, the eastern regions gather tourism, trade, finance, and other intermediary services industry, and technology-intensive industries has developed rapidly, highly correlated with foreign obvious effect of industrial concentration and supporting industries, has formed a number of the international competitiveness of industry groups, such as electronic information industry, IT industry, etc.
Development characteristics of foreign investment location
In recent years, with the optimization and upgrading of Chinas economic structure and changes of economic policy and labor costs, there are new features for the regional distribution of foreign investment. In 2008, the Development and Reform Commission jointly with relevant departments revised Midwest Industries for Foreign Investment directory, and introduced a number of preferential policies to attract foreign investment, expand the opening areas and scopes of the central and western regions at the same time, also contributed a part of policy-driven foreign-funded companies to transfer to the Midwest. However, according to the actual use of foreign investment, eastern coastal provinces and cities has a large advantage for attracting foreign investment.
It is worth noting that the entry of foreign capital also presents the characteristics of dynamic development in the east, the vast majority of foreign investors gathered in the Yangtze River Delta, Pearl River Delta and the Bohai Rim region, and tend to the development from south to north, the Yangtze River Delta and the Bohai Rimattract foreign direct investment (FDI) is increasing, while the proportion of the Pearl River Delta region has declined.
Combined with the characteristics of Chinas current foreign investment, we can see that the integrity of the market and normative elements of the supporting industries in the eastern region are the keys for attracting foreign capitals. The majority of foreign-funded enterprises can combine their own situation, sharing the fruits of Chinas market economy with the starting point of the eastern region.
