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Belt and Road Initiative and Chinese Firms’ Outward Foreign Direct Investment

Author

Listed:
  • Shu Yu

    (University of Rochester)

  • Xingwang Qian

    (SUNY Buffalo State)

  • Taoxiong Liu

    (Tsinghua University)

Abstract

This paper studies the impact of China’s “Belt and Road Initiative” (BRI) on Chinese firms’ outward foreign direct investment (OFDI). Overall, the BRI positively impacts on Chinese OFDI activities. However, both the direction and the magnitude of this impact depend on the host countries’ willingness to participate in the BRI. The BRI promotes more OFDI to developing countries that welcome China’s economic engagement and alters the effect of Chinese domestic push factors on its OFDI patterns. In addition, Chinese firms in construction and infrastructure, manufacturing, and trade-related sectors are more responsive to the BRI than firms in other sectors.

Suggested Citation

  • Shu Yu & Xingwang Qian & Taoxiong Liu, 2019. "Belt and Road Initiative and Chinese Firms’ Outward Foreign Direct Investment," GRU Working Paper Series GRU_2019_018, City University of Hong Kong, Department of Economics and Finance, Global Research Unit.
    • Handle: RePEc:cth:wpaper:gru_2019_018
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    More about this item

    Keywords

    Belt and Road Initiative; Outward FDI;

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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