A Study on Canadian-Sino Trade and Investment

A Study on Canadian-Sino Trade and Investment

Foreign trade and FDI(foreign direct investment) are the two routes to take part in the world economy competition and cooperation. This paper researches mainly on Canada’s foreign trade with China and Canada’s FDI in China. After reviewing China and Canada’s foreign trade and investment respectively, this paper concentrates on Canadian-Sino trade and Canada’s FDI in China. Under rapid growth of Canadian-Sino trade, the goods structure has changed along with China’s industrialization and development. This provides Canada a big opportunity and Challenge at the same time. At the back of soaring increase of Canada’s FDI in China, this paper does further research on the relation between Canada’s FDI in China and Canadian-Sino trade. By empirical analysis, the conclusion is paradox that the increase of Canada’s FDI in China leads to the decrease of the bilateral trade. Based on theory of OLI, this paper analyzes the reason that the fields of Canadian-Sino trade are different to the fields which Canada invested in China, and at the same time, explain the paradox well. This paper also predicts the future of Canadian-Sino trade and investment and gives some advices to Canada. At the end of this paper, some conclusions are drawn.