Direct investment cooperation between China and countries along the Belt and Road Initiative (BRI) has achieved initial success under the BRI framework. To examine how the institutional environments of these host countries influence China’s outward foreign direct investment (OFDI), this paper conducts an empirical analysis using the system GMM model, based on data from China’s OFDI in 55 BRI countries from 2005 to 2020. The findings reveal three key insights: First, China’s OFDI in the BRI region exhibits a distinct"risk-seeking"tendency toward institutional quality—that is, poorer host-country institutional environments are associated with higher Chinese investment, alongside a preference for geographically proximate destinations. Second, institutional preferences vary significantly across regions, with Asian countries attracting relatively more investment. Third, the significance of host-country institutional environments on China’s OFDI has not diminished since the official launch of the BRI in 2013.
Jixiang Wang (2025) studied this question.