Study on the trade effect of China's investment in Thailand

Abstract

With the internationalization of enterprise management has gradually reflected the inevitable trend, and transnational enterprises through the direct investment in overseas markets, has become the main part of the global operation of enterprises. In recent years, Thailand is actively developing the Eastern Corridor plan and has stepped up efforts to attract investment. This study aims to analyze the impact of Chinese direct investment in Thailand on the bilateral trade between the two countries. By using the establishment of BVAR model and impulse response analysis to explore the specific role of investment on import and export trade. The results of the study show that China’s direct investment brought trade creation effect on both imports and exports. The results of this study emphasize the important role of China's direct investment in Thailand in bilateral trade and provide valuable empirical evidence for policy makers. By further optimizing investment strategies and trade policies, economic cooperation and common development between China and Thailand can be better promoted.