Research on the Strategy of OFDI Development in Jiangsu

The reform and opening up policy, carried out more than30years ago, has seen the rapid economic development in China. Due to these eye-catching achievements, China has become the most important capital inflow country in the world. But with the deepening of economic globalization, only attracting foreign investment passively to be involved in the global division system is far from enough, we must accelerate integration into domestic and international markets, develop OFDI worldwide and promote domestic enterprises to "go out." In recent years, the economy of Jiangsu has leapt forward, accompanied with the rising cost of labor, the growing shortage of resources. Some industries even have surplus capacity. Facing this, it is necessary for enterprises in Jiangsu to develop export-orient economy, increase OFDI and tap the opportunities so as to achieve stable growth of economy.Based on the summaries and analyses of some relevant theories and research findings, this paper attempts to take Jiangsu Province as the research object, using qualitative and quantitative analysis, demonstration methods etc to do some systematic research on the strategy of OFDI in Jiangsu. To begin with, this paper separately discusses some theoretical basis, present situation and issues of OFDI in Jiangsu enterprises. Then it focuses on how to use theoretical and demonstration methods to analyze the strategic options on OFDI, including investors, modes, industry, location characters. In the main selection, the government of Jiangsu Province should not only make great efforts to support the large state-owned enterprises but also further develop private enterprise. In the mode selection, Jiangsu should choose different investment modes according to different purposes, industry characteristics and the situation in investment destinations. In the industry selection, marginal industry indicators should be used to determine the current marginal industry in Jiangsu. In order to optimize Jiangsu’s industrial structure, it is suggested that these enterprises should be relocated. Besides, this essay also focuses on the factors that affect the location choice. Currently, OFDI in Jiangsu tends to choose those who have close ties with the provincial trade, the relatively smaller domestic market and less risky investment countries or regions.Finally, on the basis of these studies, suggestions are made that both of the government and enterprises shoulder the responsibility to seek the efficient policies on OFDI, hoping to guide the moves of Jiangsu foreign investment enterprises theoretically.