China has issued several policies aimed at driving domestic enterprises to engage in outward foreign direct investments. By analyzing these policies, their impact appeared to have a double‐edged sword effect. As China's capital inflows remained far more significant than capital outflows, the Chinese government has issued several policies, including the “Go globally” strategy and the “The Belt and Road” initiative aimed at driving domestic enterprises to engage in outward foreign direct investment (OFDI). Using policy analysis technique, we analyze the OFDI‐related advantages that can be achieved to domestic enterprises under the influence of government policies to identify their impact. While the analysis shows that the Chinese government policies promoting OFDI for enterprises, stimulating domestic enterprises to expand globally also negatively impacts the OFDIs themselves.