will usually have ownership advantage. Kiyoshi Koiiman, on the basis of absolute cost advantage and comparative cost advantage theory, proposed the theory of comparative advantage in FDI, emphasizing the influence of locatio n on FDI and partly explaining the phenomenon of FDI made by developed countries to developing countries. The theories mentioned above mainly focus on the advantages owned by the investment principal. However, FDI, from a macroscopic perspective, could occur only in the premise that the objective of host country and that of multinational company match each other. The host government will make a series of investment attracting policy, which will not only encourage the participation of foreign fund in domestic economic construction, but also protect national economy from the threat of foreign fund. Therefore, investment principals, instead of determining their investment model solely by advantages of ownership, internalization, and location, must choose appropriate entering model under the restriction of host government.