Public Diplomacy and Chinese OFDI: Empirical Evidence from the Africa

Authors

  • Xinjian Ye School of Economics and Trade, Hunan University, Changsha, China
  • Zhuolin Wu School of Economics and Trade, Hunan University, Changsha, China
  • Shuocong Gu Institute of Education, University College London, London, UK
  • Shikuan Zhao School of Public Policy and Administration, Chongqing University, Chongqing, China

DOI:

https://doi.org/10.58567/rea02010004

Keywords:

China-Africa relations; Public Diplomacy; Outward foreign direct investment

Abstract

Public diplomacy is a significant factor in promoting policy communication, people-to-people bonds, and the protection of foreign assets between two nations, but there is little research on the economic worth of public diplomacy. Python was used to crawl the daily search frequency of "China", "African countries", and related terms to construct the heat index of China-Africa public diplomacy during 2011-2019, and a two-way fixed effect model was developed to examine the impact of public diplomacy on China’s outward foreign direct investment (OFDI) in Africa. The empirical results show that public diplomacy has a considerable favorable effect on China’s OFDI in Africa, and after a series of robustness tests, the basic conclusion still holds. Heterogeneity tests show the investment promotion effect of public diplomacy is more pronounced in sub-Saharan Africa and that the promotion mechanism exhibits the characteristics of poverty alleviation and risk aversion. In addition, the promotion effect of public diplomacy on China’s OFDI becomes greater as time goes on. In terms of impact mechanisms, public diplomacy may promote OFDI by enhancing financing capacity and improving national governance. The research conclusion has policy implications for promoting China-Africa public diplomacy and investment cooperation in the new era.

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Published

2023-04-23

How to Cite

Ye, X., Wu, Z., Gu, S., & Zhao, S. (2023). Public Diplomacy and Chinese OFDI: Empirical Evidence from the Africa. Review of Economic Assessment, 2(1), 54–72. https://doi.org/10.58567/rea02010004

Issue

Vol. 2 No. 1 (2023)

Section

Article

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Copyright (c) 2023 Xinjian Ye, Zhuolin Wu, Shuocong Gu, Shikuan Zhao

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