An assessment of the trade facilitation impacts on China's outward FDI to ASEAN countries

Wu, Jie, Wood, Jacob, and Jang, Haejin (2022) An assessment of the trade facilitation impacts on China's outward FDI to ASEAN countries. In: Wood, Jacob, Chaiechi, Taha, and Thirumaran, K., (eds.) Business, Industry, and Trade in the Tropics. Routledge, Abingdon, UK, pp. 97-113.

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Abstract

In 2018, China’s Outward Foreign Direct Investment (OFDI) flow to ASEAN countries was USD13.694 billion, accounting for about 77% of China’s investment in countries along the ‘Belt and Road’, a year-on-year increase of 7%. China’s OFDI to ASEAN countries is of great significance to both China and ASEAN countries. Through such cross-border investment, China and ASEAN countries can deepen international cooperation on production capacity and optimize industrial structure, so as to maintain sustained economic growth and high-quality development. Of the global foreign direct investment companies, nearly 90% of them are export companies. Therefore, the level of trade facilitation plays an important role in attracting foreign investment. This study selects the four major systems of logistics and infrastructure environment, customs environment, regulatory environment, and finance and e-commerce to measure the investment facilitation index of the ASEAN countries through the principal component analysis method, and conducts an empirical study on the impact of trade facilitation on China’s OFDI by using the extended gravity model. The results show that there are significant differences in the level of trade facilitation among different countries, with Singapore being significantly better at providing a better investment platform than other countries; the improvement of trade facilitation, especially in logistics and infrastructure environment play a key role in attracting OFDIs from China.

Item ID: 72798
Item Type: Book Chapter (Research - B1)
ISBN: 9780367721213
Copyright Information: © 2022 selection and editorial matter, Jacob Wood, Taha Chaiechi and K. Thirumaran; individual chapters, the contributors.
Date Deposited: 18 Sep 2022 22:39
FoR Codes: 38 ECONOMICS > 3801 Applied economics > 380199 Applied economics not elsewhere classified @ 100%
SEO Codes: 15 ECONOMIC FRAMEWORK > 1501 International trade policy > 150103 Trade policy @ 100%
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