Analysis on the Belt and Road Initiative and Outward Direct Investment

Abstract

The Belt and Road initiative provides mutual opportunities for China and the countries along the line. This paper analyzed the structure, influencing factors and the impact of outward direct investment from China to the countries along the Belt and road initiative. The investment is unevenly distributed and inclines to countries with abundant strategic resource, lower labor cost and better infrastructure. Various macro level factors from both host countries and China influence the scale, scope and location choice of outward direct investment. Outward direct investment from China into countries along the Belt and Road initiative would have positive impact on China’s development in various aspects, such as positive trade effect, reverse technology spillovers, industrial transformation and upgrading, and internationalization of RMB. Investment policies should be established and perfected to facilitate investment.