Study on Interactions between Foreign Direct Investment and Economic Growth

The period of 1990s is rapid development period of Foreign Direct Investment (FDI).Its growth rate even surpasses international commodity trade and gradually becomes the core force to drive growth of world economy.In 1980s-1990s, the maximum beneficiaries of FDI were undoubtedly world developing countries.Their annual mean growth rate of FDI exceeded 10%.From 2004 to 2004, global developing countries jointly attracted FDI USD 270 billion, with the growing range exceeding 97%.This creates the peak of FDI annual growing range.Among numerous developing countries, China and developing country attracted most FDI.This paper carries out empirical analysis of the relationship between FDI of the two developing countries and economic growth and explores the effects and influence of FDI on economic development of developing countries.