United States-China Foreign Direct Investment: Opportunities and Challenges
China and the United States are the world's most important foreign direct investment host country and source country. Despite the rapid growth of cross-border direct investment between China and the United States over the past five years, the mutual investment between the two countries has only a small proportion in the two countries' foreign direct investment in the world. There is still a large space for foreign direct investment in the future. China recent investment in the United States shows a positive trend. For China and United States, improving the openness of two-way cross-border investment would great benefit to both countries. The investment provides the necessary funds for economic development and creates jobs in emerging market; enable enterprises to reduce production costs and consumer prices, thereby increasing the global competitiveness. Also, by promoting specialization, achieving better economies of scale and encouraging healthy market competition to achieve global integration, can greatly enhance consumer welfare. More importantly, the two countries to strengthen economic cooperation, is conducive to increasing mutual understanding, and further improve bilateral openness.However, bilateral investment in China and the United States there are still obstacles, including concerns about strategic investment in the industry, the imbalance in the field of investment concerns, policy imperfect, too restrictive restrictions on the visa, there are some lack of effective communication, exchange And mutual trust, as well as cultural differences and domestic policy interference problems. In order to promote bilateral investment between China and the United States, the two governments should be some strategic thinking and methods to make some fundamental changes and adjustments.The study using empirical analysis suggests China’s government with the strategy adjustment and policies that will encourage US-China foreign direct investment benefit in technological innovation, create jobs, and upgrade infrastructure while building national security vigilance, and laying the foundation for a better partnership with China.
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