Foreign Direct Investment Spillover Effect on China’s Sustainable Development

Abstract

The unbalanced growth of FDI in China has seriously affected the coordinated development of China’s regional economies. Therefore, to achieve comprehensive, coordinated and sustainable development, China’s main strategic task is determining how to adopt positive and effective FDI policies to reduce this regional imbalance in FDI. The purpose of this paper is to explore and study the spillover effects of foreign direct investment (FDI) on China’s sustainable development. In this paper, based on the new political economics theory and overflow effects, comparative research and statistical research methods are adopted that combine static and dynamic analysis. Empirical research methods are combined with normative research to analyse the spillover effects of FDI on China’s sustainable development, particularly under the new situation of global crisis and the accompanying difficulties, to determine how to promote China’s FDI and the development of China’s sustainable progress strategy. The study found that in 2018, FDI in China reached a value of 13.466 billion US $, and the year-on-year growth in FDI in recent years has been basically stable at approximately 4 %. Asia is the main source of FDI in China. In 2018, the amount of FDI in Asia reached $109.1938.7 billion, accounting for 83.33 % of the total investment. Hong Kong, with its unique advantages, accounted for 72.12 % of FDI in China. FDI inflows are mainly directed to primary industry and the service sector, and the growth rate of foreign investment in 2016 in these sectors was 68.52 and 170.77 %, respectively, compared with 2007. FDI also mainly flows to the eastern region of China. By the end of 2018, the amount of foreign capital utilized in the eastern region reached $1,622.9 billion, representing 85.4 % of the aggregate FDI in China. The effect of FDI on China mainly focuses on three areas: economic growth, social development and environmental protection. FDI has brought positive spillover effects to China’s sustainable evolution, but with China’s continuous development, especially the change in its economic development mode, it has been consistently exposed to negative spillover effects.

Eco-Technology and Eco-Innovation for Green Sustainable Growth

“…On this basis, a system dynamics model for the sustainable and safe development of ATC crews is developed to explain the complex interactive feedback mechanisms and dynamic mechanisms among the factors of the air traffic control system, and policy recommendations. The economic aspects of sustainable development have been studied by Han et al [10]. As the uneven growth of foreign direct investment in China has significantly affected the coordinated development of China's regional economy, they use the New Political Economy theory and spillover effects as the basis for a comparative and statistical research method combining static and dynamic analysis, and an empirical research method combining with a normative study to analyse the spillover effects of FDI on China's sustainable development.…”

Impacts of the Belt and Roads Initiative on Sustainability: Local Approaches to Spatial Restructuring in the Aras Special Economic Zones

“…They emphasize competitive advantages to make regions more attractive and prevent degenerative processes [8,9]. The economic changes impact pre- [10,11] and post- [12][13][14][15] project assessment, based on the development planning, which is decided by the synergy generated by the project network structure, and determines the efficiency of this program [16]. Foreign Direct Investment (FDI) has been identified as a significant influence on spatial development in emerging economies [9,[17][18][19].…”

The Impact of FDI on China’s Urban–Rural Income Gap

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