Comparison Study on the Actual FDI Utilization among Jiangsu, Guangdong, Shandong and Zhejiang

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http://www.seipub.org/rae

Research and Applications in Economics Volume 2, 2014

Comparison Study on the Actual FDI Utilization among Jiangsu, Guangdong, Shandong and Zhejiang Shuangqin Liu*1, Yingxue Mei2 Business School, Hohai University 8 Focheng West Road, Jiangning District, Nanjing, China lsqcarol@163.com; 2976813874@qq.com

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Abstract Guangdong, Jiangsu, Shandong and Zhejiang were the top four provinces in China in 2012 by local gross product according to the National Bureau of Statistics of the People’s Republic of China (2013). The amount of their foreign investment actually utilized was US$23.54911 billion, US$35.75956 billion, US$12.35267 billion, and US$13.06926 billion respectively. Comparison method is adopted to analyze the actual FDI utilization in the four provinces. The findings show that foreign direct investment (FDI) plays a very important role in the economic development of the provinces. In the FDI utilization, they have summarized their experience and lessons, such as adding capitals, increasing employment and tax revenue, promoting international trade, industry structure adjustment, and economic growth, bringing state-of-the-art operation concepts, management methods and marketing skills etc. They have both common problems and special problems in their FDI utilization including FDI utilization imbalance in industry distribution and region distribution and so on. Their experience and lessons can be used by other provinces in China for reference so that they can use their FDI more reasonably and the FDI can be used to play a more effective part in the economic development in all the provinces and even the whole country. Keywords Actual FDI Utilization; Comparison Study; Countermeasures

Introduction According to the National Bureau of Statistics of the People’s Republic of China (2013), in 2012 in China, by local gross product, the top four provinces were Guangdong (RMB5706.792 billion), Jiangsu (RMB5405.822 billion), Shandong (RMB5001.324 billion) and Zhejiang (RMB3466.533 billion). Their amount of foreign investment actually utilized was US$23.54911 billion, US$35.75956 billion, US$12.35267 billion, and US$13.06926 billion respectively. Foreign direct investment (FDI) plays a very important role in

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the economic development of the provinces, therefore, to study how the four provinces use FDI and summarize their experience and lessons in the utilization of FDI is of great significance. Their experience and lessons can be used by other provinces in China for reference. Data Analysis In 2004, the statistics methods in China were changed, so in this paper, the data about the actual utilization of FDI by the four provinces were from 2004-2012. Unless otherwise stated, FDI in the paper refers to the FDI actually utilized. The data in Table 1 are from the statistics of the Yearbooks of the 4 provinces. GD, JS, SD and ZJ refer to Guangdong, Jiangsu, Shandong and Zhejiang respectively. TABLE 1 FDI ACTUALLY UTILIZED BY THE FOUR PROVINCES UNIT: US$10,000

GD JS SD ZJ GD JS SD ZJ

2004 1001158 1213783 870064 668128 2009 1953460 2532298 801007 993974

2005 1236391 1318339 897072 772271 2010 2026098 2849777 916833 1100175

2006 1451065 1743140 1000069 888935 2011 2179836 3213173 1116022 1166601

2007 1712603 2189206 1101159 1036576 2012 2354911 3575956 1235267 1306926

2008 1916703 2512001 820246 1007294

Table 1 shows that the scope of FDI utilization in all the 4 provinces is being increased gradually but at different growth rates. From 2004-2012, Jiangsu was the first and Guangdong the second. From 2004-2007, Shandong was the third and Zhejiang the fourth; but from 2008-2012, Zhejiang surpassed Shandong and was the third, so Shandong becomes the fourth. FDI in Jiangsu and Guangdong is far more than the other two, Shandong and Zhejiang.


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