Factors Influencing International Infrastructure Investment: An Empirical Study from Chinese Investors

Abstract

International economic cooperation accelerates the flow of capital, technology, labor, and other factors between different countries, which promotes global sustainable development. Building infrastructure construction is an important way to strengthen social development, and absorbing foreign capital is an effective way for developing countries to improve their infrastructure and to promote economic development. This study puts forward the factors that have influenced China’s investment in international engineering projects, and it constructs a panel data regression model for empirical testing. The study shows that, first, international infrastructure investment tends to select countries or regions with good condition of highway infrastructure. Second, international infrastructure investment tends to choose countries or regions with low development level of port and power infrastructure. Third, bilateral diplomatic visits play a significant role in promoting international infrastructure investment. Fourth, international infrastructure investment tends to choose countries or regions with good resource endowment. This study reveals the influencing factors and the mechanisms for the choices of location for China’s investment in international engineering projects, providing a theoretical framework for investors to optimize international infrastructure investment and management, as well as providing the policy references for developing countries to attract international infrastructure investment.