Overseas Direct Investment Research Articles

A Dynamic Monitoring Method of Public Opinion Risk of Overseas Direct Investment-Based on Multifractal Situation Optimization.

The negative public opinions and views on overseas direct investment (ODI) of a multinational enterprise (MNE) will damage the image of its brand and are likely to bring it serious economic and social losses. So, it is important for the MNE to understand the formation and spread mechanism of public opinion risk (POR) in order to effectively respond to and guide the public opinion. This research proposed a multifractal-based situation optimization method to explore the POR evolution based on the media-based negative sentiment on China's ODI. The sentiment measurement is obtained by a directed crawler for gathering the text of media reports corresponding to a certain ODI event using a URL knowledge base from the GDELT Event Database. Taking the public opinion crisis of the tax evasion incident of the local arm of China's MNE in India as an example, the experiments show that this method could dynamically monitor the POR event in real-time and help MNE guide the effective control and benign evolution of public opinion of the event.

The Impact of Financing Structure on Enterprise’ Overseas Direct Investment: A Case of A-share Listed Companies in China

This research analyzed the impact of financing structure on enterprises' overseas direct investment and its underlying mechanisms. It reviewed relevant literature and theories, used panel data of 1,725 Chinese A-share listed companies from 2000 to 2020, and employed the debt-to-equity ratio as a measure of financing structure. The study applied the Probit model for benchmark regression and conducted robustness tests using the Logit and negative binomial panel models. Additionally, it explored the influence mechanism through factors like innovation, research and development, productivity, and performed heterogeneity analysis and endogeneity tests. (1) The financing structure had an impact on enterprises' overseas direct investment. A higher proportion of equity financing in the structure positively contributed to the initiation of overseas investment projects and led to an expansion in scale. (2) The financing structure influenced enterprises' overseas direct investment by impacting factors such as innovation, research and development, and productivity. (3) The results of analyzing industry heterogeneity indicated that the financing structure of manufacturing enterprises had a limited impact on their overseas direct investment.

The Impact of Financing Structure on Enterprise’ Overseas Direct Investment: A Case of A-share Listed Companies in China

This research reviewed relevant literature and theories to analyze the influence of financing structure on enterprises' overseas direct investment and its influence mechanism. The panel data of 1,725 Chinese A-share listed companies from 2000 to 2020 was used. The debt-to-equity ratio index was used to measure the corporate financing structure, and the model was established combining the control variables at the enterprise level. The Probit model was used for benchmark regression, and the Logit and negative binomial panel model were used for robustness tests. At the same time, the influence mechanism was analyzed from the perspective of enterprise innovation research and development and productivity, as well as the heterogeneity analysis and endogeneity test. The conclusion is as follows: (1) The financing structure affected the overseas direct investment of enterprises. The high proportion of equity financing in the financing structure of enterprises was conducive to the generation of overseas investment projects and the increase in scale (2) The financing structure affected the overseas direct investment of enterprises through innovation, research and development, and productivity of enterprises. (3) According to the results of industry heterogeneity, the financing structure of manufacturing enterprises did not have a significant impact on their overseas direct investment.

An Analysis of the Factors of Overseas Direct Investment for the EV Battery Production in Korea and China

An Analysis of the Factors of Overseas Direct Investment for the EV Battery Production in Korea and China

Civilisation on Pause – Introduction to special issue ‘China's Global Capital and the Coronavirus: Views from Comparative Law and Regulation’

AbstractPandemics have a history of interrupting civilisations. From the Greeks and Romans to the British Empire, pandemics have eroded political authority and caused economic instability. The twenty-first century has been hailed as the ‘Asian century’, with China's ascent as central to a reconfiguration of global capital and power. The COVID-19 pandemic, that began in 2019 and still rages as of this writing, started in China and was exacerbated by initial repression by the local government authorities before the central government could implement appropriate disaster response. Since then, COVID-19 has been one of the most devastating pandemics in the history of globalisation. Its mortality has been coupled with regulatory responses which at times have been debilitating to national economies, no less is this true for China's own regulatory response which has been anomalous across the world. This Special Issue explores the impact the COVID-19 pandemic has had on Chinese overseas direct investment and the concomitant forms of capital (symbolic, social, and political). It features collaborative research and writing by early career experts from throughout the world, as part of the ‘China, Law and Development’ project, based at the University of Oxford. It examines how China, its trade partners, and transnational orders have responded to the pandemic through law and regulation across an array of fields: dispute resolution, legal services, immigration law and policy, digital surveillance, global health governance, and democratic fragility.

The Cooperative Game Study of Chinese Overseas Direct Investment in the Construction of Green Ports

With the development of Chinese overseas direct investment (ODI) in green ports, a series of conflicts and contradictions among the participating parties have emerged, which in turn affect and hinder the process of project construction. This paper analyzes the current situation of Chinese ODI in green ports, constructs a cooperative game model between Chinese port investment enterprises and the host government with introduces the effort level, and selects three actual green port projects for calculation and analysis to show that Chinese ODI in green ports can bring economic and environmental benefits to both parties. It is found that the expected revenues and effort levels of both the Chinese port enterprises and the host government are positively correlated with each other’s effort levels, and there exists an optimal effort level and an optimal investment amount of the Chinese port enterprises to maximize the benefits obtained by both parties in the green port project. At the same time, the cases studied find that the benefits obtained by the host government are higher; Therefore, Chinese port investment enterprises can promote green ports projects by finding their own optimal effort level. Additionally, active cooperation is the optimal choice of the host government.

국가의 부패수준과 해외직접투자 사이의 관계

Purpose of This study is to investigate the role of corruption in Foreign Direct Investment. To achieve this objective, this study analyzed the impact of corruption on Korea’s foreign direct investment in 10 ASEAN countries from 2000 to 2019 using 200 observations (country-year) using panel analysis. As a result, it was confirmed that the FDI inward of ASEAN member countries is s teadily increasing. This indirectly supports the evidence for the importance of FDI inflows from ASEAN member states. Furthermore, among the determinants of Korea’s foreign direct investment, corruption in ASEAN member countries was found to have a rather positive effect. It was found that the major foreign direct investment inflows currently being made in ASEAN member countries is a form of vertical investment resulting from the reduction of production costs, and the country has a positional advantage. It is recognized that the country’s low transparency makes it possible to easily attract foreign direct investment. Besides, ASEAN member countries need to change their outward FDI type to an advanced country type in the long term, and it is judged that the low level of corruption will not be helpful in the long term to attract FDI. Corruption factors are contributing to overseas direct investment as a factor of the current l ocation advantage, but i t is j udged that improvement i s needed g radually i n social a nd economic aspects.

Technical Efficiency and Employment Elasticity in Korea’s Manufacturing Industry

Purpose This paper analyzes how wages, capital stock, exports, imports, overseas direct invesments (ODI) as well as technical efficiency affect employment elasticity in Korea’s manufacturing industry. Design/Methodology/Approach To analyze determinants of employment elasticity in the manufacturing sector, we measure technical efficiency by using the stochastic production frontier model. Using panel data consisting of 40 manufacturing industries drawn from the Industrial Statistical Analysis System (ISTANS), we clarify what negatively affected employment elasticity during the period between 2005 and 2019. Findings Our empirical analysis shows that ODI and capital have statistically significant and positive effects on employment elasticity while wage and imports have statistically significant and negative effects. Moreover, employment elasticity increases as technical efficiency improves. Our study implies that the establishment of a global network through overseas direct investment contributes to increasing domestic employment. Also, capital appears to have a complementary relationship with employment so that investment is important to increasing employment. Research Implications In the case of manufacturing industries with a comparative disadvantage, it is necessary to promote industrial restructuring to increase technical efficiency and promote the relocation of labor.

The impact of transparency stage and overseas refund investment inflows on the human improvement index

This paper examines the impact of the transparency stage and overseas refund investment inflows at the human improvement index. This paper aims to explore the mediating effect of the economic boom at the impact of transparency ranges and foreign direct funding inflows at the human improvement index. This research was carried out in 9 countries in Southeast Asia with a research length from 2012 to 2019. The facts analysis system changed into done the usage of course evaluation. The outcomes indicate that the transparency stage and overseas direct investment have a tremendous influence on economic growth and the human improvement index. Economic growth turned into additionally located to impact the human development index significantly. Therefore, monetary expansion is verified to mediate the transparency stage effect on the human development index. But the economic increase isn't always proven to have a mediating effect on the impact of foreign direct funding at the human improvement index. Therefore, based totally on the outcomes of this examination, the authorities of each use in Southeast Asia need to create a transparent government to increase economic increase and human improvement index. Further, outside investment needs to be recommended to make an excellent monetary boom and human development index.

Environmental Effects of China’s Overseas Direct Investment in South Asia

This paper attempts to analyze the effects of China’s outward direct investment on environmental pollution in selected South Asian countries from 2004 to 2019 under framework of environmental Kuznet curve hypothesis. This empirical work is accomplished through fully modified ordinary least square. The findings of the full panel of fully modified ordinary least square indicates that China’s outward direct investment significantly spurs carbon emissions by (9.9%), which destroy the environment quality in the region. However, the estimated coefficients of the full panel of the fully modified ordinary least square indicates that (+) and (−) values of GDP and GDP square validate the environmental Kuznet curve hypothesis existence in the South Asia economies. Furthermore, when taking the individual countries, the environment consequences, individual characteristics of the countries and the GDP growth shows various temporal pattern of KEC hypothesis. Like in India there exist inverted U-shape curve, while Pakistan and Nepal manifest U-shape curve, whereas Bangladesh shows N-shape curve. Furthermore, this paper has identified bidirectional causality between economic growth, energy, financial development and carbon emissions. The empirical evidence implies that when governments consider foreign direct investment, they should priorities environmental protection mechanisms.

ATTRACTING OVERSEAS INVESTMENT IN ENTERPRISES ECONOMIC ACTIVITY

Abstract. One of the most significant problems of modern Ukraine is the stability of economic development. Attraction of overseas investments has significant impact on the state and dynamics of Ukrainian economy, ensures scientific and technological progress, economic growth, creation of additional and preservation of existing jobs, promotes intensification of business activity.
 The attractiveness of overseas investments in the economic activity of the enterprise was assessed in this punlication. The features of this process from existing is the evaluation of 6 components: competitors, product range and export, operating expenses, the state of fixed assets and the workforce.
 As the result on evaluation, problems and ways to increase the efficiency on attracting foreign investment in the company economic activity, its strengths and weaknesses have been identified, and measures have been proposed to improve the process on making informed management decisions related to ensuring investment attractiveness in modern farming conditions.
 In order to increase overseas investment and expand scope of their using in enterprise economic activity, it is advisable to develop organizational and economic mechanism. It should be combined different functional blocks: institutional and legal, monetary, tax and territorial-organizational. It should be bring together the components of the organizational and economic mechanism and provide the vector approach on formation favorable conditions for attracting overseas investment in enterprises economic activity.
 Overseas investment is financial resource, that will be helping to increase enterprises efficiency, the development of relevant territories and cities, to improve the social protection of citizens.
 Attracting overseas investment into enterprise economic activity taking into account competitors, assortment and export of products, operating expenses, the state of fixed assets and labour will be creating opportunities to improve the investment environment in state and increase the flow of overseas direct investment in short future.
 Keywords: overseas investments, competitors, products assortment, product exports, operating costs, labor force, fixed assets, business activity.
 JEL Classification: G 30, L 21, M 21.
 Formulas: 0; Fig.: 0, Table: 8, Bibl.: 12.

RISK ASSESSMENT OF FOREIGN DIRECT INVESTMENT OF CHINESE AGRICULTURAL ENTERPRISES

With the global trend of foreign direct investment, Chinese agricultural enterprises have also increased the pace of foreign direct investment. At present, Chinese agricultural enterprises have invested in development in more than 30 countries, including Southeast Asia, Africa and Latin America. Ocean fisheries development is underway in the high seas of the Pacific, Atlantic, and Indian oceans. There are also planting and forestry bases in the Russian Far East and Central Asian countries. The benefits of Chinese agricultural enterprises' overseas investment are obvious. It is not only conducive to Chinese enterprises to use foreign resources, funds and technology, but also to avoid various barriers and increase the international market share. However, while encouraging China's agricultural enterprises to go global, we should also be clearly aware that the overseas direct investment of China's agricultural enterprises is still in the primary stage. The level of agricultural enterprises is still relatively low, and overseas direct investment faces a variety of risks. Analysis and studying these risks will help Chinese agricultural enterprises to effectively prevent and control them in foreign direct investment. By taking into account the integrity and dynamics of the overseas direct investment environment, the risk evaluation index system of foreign investment projects of Chinese agricultural enterprises is constructed. Representative items were selected for risk evaluation using hierarchical analysis and entropy weight coefficient method. The results show that there are prominent risk factors such as international agricultural market risk, political and legal risks of host countries, domestic institutional barriers and enterprise own technical restrictions. In order to prevent and reduce investment risks, the government should increase policy support and set up special agricultural overseas investment service institutions. Enterprises should establish an effective risk evaluation mechanism to promote the research and development and promotion of agricultural technology.

China's FDI in Europe and Europe's Policy Response

China’s investment in the European Union (EU) increased significantly during the European financial crisis, but has been on the decline in recent years. The surge of Chinese investment has raised concerns and demands for analysis on the negative effects it could have on the EU companies and industries. In this context, the present study aims to analyze the main characteristics of Chinese investment and M&A in Europe, major policy issues between the two sides, the EU’s policy responses, and prospects of Chinese future investment in Eu-rope, going on to draw important lessons for Korea.To summarize the main characteristics of China's investment in Europe, the study found that the EU's share of China's overseas direct investment has continued to increase until recently. Second, investment in the Central and Eastern European Countries (CEECs) is gradually increasing, although it is still insignificant compared to the top five destinations in the EU: Netherlands, Sweden, Germany, Luxembourg and France. Third, China's investment in the EU is being made in pursuit of innovation in manufacturing and to acquire high-tech technologies. When it comes to China's M&A in Europe, the study found that the proportion of indirect China's M&As (via third countries (e.g. Hong Kong) or Chinese subsidiaries already established in Europe) was relatively higher than direct ones.Empirical factor analysis of investment also shows that China's investment in the EU is strongly motivated by the pursuit of strategic assets. Other factors such as institutional-level and regulatory variables are found to have no significant impact, or have an effect contrary to expectations. This suggests that China's investment in the EU is based on the Chinese government's growth strategy, and accompanies an element of national capitalismToday, It is highly expected that the COVID-19 pandemic will have a reorganizing effect on the global value chain (GVC) and Foreign investment regulation in the high-tech sector motivated by national security is emerging as a global issue as the US and the EU are tightening their control. As Korean companies are not free from the risk of falling under such regulations, a thorough and careful response is required. And for the Korean government, it is necessary to prepare legal and institutional measures regulating foreign investment in reference to the US and the EU.

Indian overseas direct investment in services sector: a study on emerging trends and patterns

Indian overseas direct investment in services sector: a study on emerging trends and patterns

Indian overseas direct investment in services sector: a study on emerging trends and patterns

Indian overseas direct investment in services sector: a study on emerging trends and patterns

The Impact of Industry Architectures and Supply Chains on Successful Expansion in Emerging Markets

Korean firms have been vigorously searching and exploring overseas market opportunities through export and overseas investment. As of end of 2019, there were more than 80,000 Korean overseas subsidiaries all over the world. With Korean overseas direct investment increasing recently, it became one of the important issues for overseas investors to be successful in the global market. There are a lot of studies on factors influencing the performance of overseas subsidiaries such as ‘firm’ and ‘country’ factors. This study empirically examines subsidiary performance determinants with ‘industry architectures’ by using a sample of 292 overseas Korean firm subsidiaries. Industry architectures are the stable but evolving sets of rules and roles through which labor is divided within a sector. This article considers how industry architectures shape success in international expansion. Industry architectures differ between countries, are not necessarily technologically determined, shape firms’ capabilities and their competitive environment, and constitute a distinct level of analysis. We extract antecedents of related theory and empirically test its impact with a survey of Korean firms expanding in emerging economies. We would say this is the first study which tries to focus on industry architectures with the performance of Korean overseas subsidiaries. We find that separability and similarity of industry architectures across countries and localization of subsidiaries are robust and important predictors of success in international expansion. Our results suggest that industry architectures should be added to firm and country as an intermediate level of analysis that helps explain success in international expansion. While we established a pattern, much more remains to be done. We focus on the success of foreign operations, but we do not consider the broader benefits of going abroad, such as the learning or network effects that accrue at the level of the entire firm. The next obvious question is whether the results would differ in the developed market context. These we leave for future research to consider.

Overseas Direct Investment from India: Setting Up of Step-Down Subsidiaries

The Indian legal framework regulating overseas direct investment from India is evolving to adapt to the challenges put forth by the increase in outward investment. In this context, the Foreign Exchange Management (Transfer or Issue of Any Foreign Security) Regulations, 2004 govern the setting up of step-down subsidiaries by an overseas Joint Venture (JV) or Wholly Owned Subsidiary (WOS) of Indian residents. The Regulations, while prohibiting the setting up of step-down subsidiaries by an overseas JV/WOS of an individual, allow the same in the case of overseas JV/WOS of other entities. This article argues that the reasons for this differential treatment include the historically restrictive approach of the Reserve Bank of India towards individuals and its concerns against the roundtripping of funds. The article lays down the context in which the Regulations operate by looking at the reasons that influence outward direct investment in India. It then analyses the regulatory approach governing the setting up of overseas step-down subsidiaries vis-à-vis individuals and other entities, highlighting the underlying concerns of curbing the menace of round-tripping of funds. The article concludes with critiquing the differential treatment between individuals and entities, and the restrictive approach taken in curbing the problem of round-tripping of funds. Indian overseas direct investment, step-down subsidiary, outward Indian investment, multi-layered corporate structure, round-tripping, Reserve Bank of India, Foreign Exchange Management Act.

The role of China's aid and ODI in the economic growth of African countries

Has external capital, such as foreign aid and foreign direct investment (FDI), been able to help the economic growth in host countries? Our paper examines the effects of China's aid and its overseas direct investment (ODI) on economic growth in 47 African countries from 2003 to 2013. We find that China's aid has significant positive effects on African economic growth. However, China's ODI plays no major role in African countries' economic growth. In addition, the relationship between aid and growth varies according to the different categories of aid, and its marginal contribution is nonlinear.

Impact of the Belt and Road Initiative on China’s soft power: preliminary evidence

ABSTRACTUsing latest available international survey data on soft power and China’s overseas direct investment (ODI) statistics, this paper examines if China’s Belt and Road Initiative (BRI), commonly perceived as an institution setup by China to build cross-border infrastructure to bolster trade and investment, had increased China’s international image or soft power. We find that the overall impact of ODI in BRI countries on China’s soft power is statistically insignificant over the period 2011 to 2016, yet further analysis reveals that the investments in the BRI countries along the land route bring significant improvement in China’s soft power.

FTA 체결국에 대한 경제적 효과 분석 : 교역효과와 해외직접투자효과를 중심으로

FTA 체결국에 대한 경제적 효과 분석 : 교역효과와 해외직접투자효과를 중심으로