Shanghai, China's finance capital, lights up at night. Photo by Ben Spreng
A new study from The Australian National University shows that foreign direct investment (FDI) both into and out of China is improving economic stability and driving development in Asia and the Pacific. In a major study, Chunlai Chen from the ANU Crawford School examined levels of FDI in 49 developing countries between 1992 and 2008. Chen said that increases to FDI flows into China over the last 30 years have created a win-win situation for other countries in the region - including Australia. "The huge amount of FDI inflows into China in the last three decades has been a cause of celebration for some and of concern for others. There are increasing concerns that China's FDI success has been excessive and crowded out FDI into other developing countries," said Chen. "However, my study found that FDI inflows into China have a significantly positive effect on FDI inflows into other developing countries. "This positive and complementary effect of FDI inflows into China on FDI inflows into other developing countries, and especially into Asian developing economies, may be linked to the increased resource demands of a growing China and the deepened integration of production networking between China and other Asian economies.
TO READ THIS ARTICLE, CREATE YOUR ACCOUNT
And extend your reading, free of charge and with no commitment.
