Do Natural Disasters Reduce Foreign Direct Investment in Sub-Saharan Africa?

Katoka, Ben

doi:10.1016/b978-0-12-817465-4.00031-5

Cited by 3 publications

(12 citation statements)

References 43 publications

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“…The context in which disasters happen seems to be necessary to understand their impact on business, which can affect companies in their normal course of operations (Oh & Oetzel, 2011), which in turn, refers to local conditions that can limit the potentials benefits of FDI for the host country (Alfaro et al, 2004). The search for an understanding of what are the consequences caused by natural disasters is essential for many people and countries, including international development agencies and public policy makers (Bergholt & Lujala, 2012), since natural disasters are related to numerous costs for companies, which is the case of damages caused to raw materials, production stoppage and damage to fixed and capital assets (Katoka, 2020).…”

Section: Natural Disastersmentioning

confidence: 99%

“…Severe natural disasters pose not only a serious risk to human life, as the terrible tsunami in 2004 near Sumatra revealed, which claimed the lives of around 150,000 people just in Indonesia. These events are also devastating to the ability of a country or region to produce, through their effects on physical capital stocks, labor forces, transport infrastructure, agricultural resources and stocks, among other productive resources (Escaleras & Register, 2011;Katoka, 2020).…”

Section: Natural Disastersmentioning

confidence: 99%

“…Natural disasters affect economic progress, human capital and the competitiveness of countries (Klomp & Valckx, 2014), unlike other risks, the control of natural disasters becomes more difficult (Katoka, 2020). Local country conditions can target the potential benefits generated by FDI (Alfaro, Chanda, Kalemli-Ozcan & Sayek, 2004).…”

Section: Introductionmentioning

confidence: 99%

“…The results obtained in the literature for the effects of natural disasters on FDI are diverse. While for some authors the number of foreign subsidiaries does not decrease in response to natural disasters (Oh & Oetzel, 2011;Katoka, 2020), or even, natural disasters cause positive long-term effects on FDI (Kato & Okubo, 2018;Doytch , 2019), others conclude that greater severity associated with natural disasters tends to reduce FDI flows (Yang, 2008;Anuchitworawong & Thampanishvong, 2015;Escaleras & Register, 2011;Khan et al 2020;Toner-Rodgers & Friedt, 2020).…”

Section: Introductionmentioning

confidence: 99%

“…The discovery was that natural disasters negatively affect FDI in the short term and positively in the long term (Doytch, 2019). Katoka (2020) analyzed 44 countries in Sub-Saharan Africa between 1970 to 2018, noting that the total number of disasters that occurred in a period prior to 3 years does not significantly affect FDI inflows. In studying the countries that belong to Belt & Road, Khan et al (2020) concluded that serious natural disasters negatively influence FDI.…”

Section: Introductionmentioning

confidence: 99%

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O efeito dos desastres naturais no investimento estrangeiro direto dos países

Ramos

Krug

Ferretti

et al. 2021

RIAE

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Objective: This study aims to analyze the influence of natural disasters on countries' FDI.Method: We used data from 137 countries, considering the period from 2011 to 2017. The secondary data used to measure Foreign Direct Investment are from the UNCTAD - United Nations Conference on Trade and Development following the study by Alfaro et al. (2004). For data on natural disasters, the EM-DAT database - The International Disaster Database provided by CRED - Center for Research on the Epidemiology of Disasters - was used, based on the studies by Toya Skidmore (2007) and Escaleras Register (2011). The analysis was performed through Linear Regression of panel data.Originality/Relevance: This study points to a direction of research for those interested in expanding the flows of Foreign Direct Investment in their countries, being significant in the field of business, government, public policy makers and the third sector.Results: The results show that when an economy suffers from natural disasters that cause deaths and, consequently, a reduction in human capital, foreign investors can negatively portray this fact. On the other hand, the number of occurrences and the loss in millions of dollars when analyzed individually do not discourage FDI and the presence of multinationals in the affected country. The variables: total of injured, total of affected, and total of homeless have no relation with FDI in the analyzed sample. It is indicated that, in the face of a natural disaster, countries create opportunities for the replacement and reconstruction of infrastructure and human capital.Theoretical contribution: We seek to contribute theoretically to the recent increase of studies that verify the relationship between natural disasters and FDI in the light of the institution-based view. We direct greater understanding to the premise that natural disasters affect a country's economy as they cause FDI reduction, and we provide the foundation for future studies. While previous studies are concerned with FDI determinants, being tax incentives and property rights, this study focuses specifically on the different variables that aggregate natural disasters. In addition, the study aims to expand the perception of decision makers, belonging to the government, private entities and the third sector, so that they can reduce and prevent the occurrence of natural disasters, thus attracting FDI flows in their countries.

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Section: Natural Disastersmentioning

confidence: 99%

Section: Natural Disastersmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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O efeito dos desastres naturais no investimento estrangeiro direto dos países

Ramos

Krug

Ferretti

et al. 2021

RIAE

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Shaking up Foreign Finance: FDI in a Post-Disaster World

Reinhardt

2024

EconDisCliCha

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Covid-19 and the Decline in Investment in West Nusa Tenggara: Indonesia

Dewayani,

Ginting,

Azizurrohman

et al. 2024

EQUITY

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This research examines the effects of the COVID-19 pandemic on investment in West Nusa Tenggara (NTB), Indonesia. Using a combination of quantitative data from the Republic of Indonesia's Investment Coordinating Board and qualitative data from the Head of the Office of Investment and One Stop Integrated Services, the study investigates investment realization by district and city, sector, and investor's country of origin. The analysis reveals that even prior to the COVID-19 outbreak, investment levels in NTB were declining due to a series of natural disasters, including an earthquake in 2018. The pandemic further exacerbated the decline in investment, with many investors opting to delay their investments in the region. However, some sectors such as mining, tourism, and transportation showed improvements during the period. The findings highlight the challenges faced by West Nusa Tenggara in attracting investment and achieving regional development goals. The study emphasizes the importance of understanding a region's potential and creating favorable investment conditions to stimulate economic growth. Keywords: Covid-19, Investment, NTB

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Do Natural Disasters Reduce Foreign Direct Investment in Sub-Saharan Africa?

Cited by 3 publications

References 43 publications

O efeito dos desastres naturais no investimento estrangeiro direto dos países

O efeito dos desastres naturais no investimento estrangeiro direto dos países

Shaking up Foreign Finance: FDI in a Post-Disaster World

Covid-19 and the Decline in Investment in West Nusa Tenggara: Indonesia

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