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Effects of Foreign Direct Investment Inflows on Food Security in ASEAN CountriesLinhan Huang
+Food Security
Food is the most basic human needs Human rights Social and political stability Poverty reduction
Hunger and undernourishment are major obstacles to economic development
The State of Food Insecurity in the World (Food and Agricultural Organization(FAO), 2014)
+What is Food Security?
“…when all people at all times have access to sufficient, safe, nutritious food to maintain a healthy and active life”
– World Food Summit, 1996
+Foreign Direct Investment
Developed Countries
Developing
CountriesFDI
Capital, technologies, human capital, etc.
+Foreign Direct Investment
$778 Billion
54% of Global FDI Inflows
+FDI and Food Security
Modernization Theory FDI Economic Growth of all groups Improved Food Security
Dependency Theory FDI Inequality Worse Food Insecurity
+ASEAN—Association of Southeast Asia Nations Indonesia, Malaysia, Philippines, Singapore, Thailand,
Brunei Darussalam, Viet Nam, Lao PDR, Myanmar and Cambodia
+FDI and Food Security in ASEAN
+FDI Inflows in ASEAN
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
8.00
FDI Inflows in ASEAN
Year
2005
US
$ in
Bill
ions
+FDI Inflows in ASEAN
Brunei
Darussa
lam
Cambo
dia
Indon
esia
Lao P
DR
Malaysi
a
Myanm
ar
Philip
pine
Singa
pore
Thaila
nd
Vietna
m02468
1012141618
0.72 0.292.48
0.07
4.64
0.31 1.23
16.33
4.552.61
Mean FDI Inflows in ASEAN (1989-2011)
2005
US
$ in
Bill
ions
+Food Security in ASEAN
Prevalence of Undernourishment Energy supply (kcal/capita/day)Food Protein supply (grams/capita/day) Nutrition
+Food Security in ASEAN
World
Developing Countries
Asia
Southeast Asia
Cambodia
Indonesia
Lao,PDR
Philippines
Thailand
Viet Nam
0 5 10 15 20 25 30 35 40 45 5018.6
23.223.7
29.639.9
19.944.6
24.243.8
46.9
12.514.9
13.910.9
17.18.6
27.817
7.39
Undernourishment Trends 1990-92 vs. 2010-12 (FAO, 2013)
2010-121990-92
Prevalence of Undernourishment (%)
+Do FDI inflows exert any positive influence on food security in ASEAN countries?
+Equation
+Models
+Results
+Prevalence of Undernourishment
$10 Billion FDI Inflows 5.8 Percentage Points 30 Million People
+Daily per Capita Energy Supply$10 Billion FDI Inflows
+Daily per Capita Protein Supply12%
$10 Billion FDI Inflows
Daily protein needed by children between 4-8 years old (Institute of Medicine, 2005)
+Political Stability
+Conclusion
FDI Inflows help improve food security in ASEAN countries.
+ReferencesAsian Development Bank. (2012). Food security and poverty in Asia and the Pacific: key challenges and policy issues . Retrieved from http://www.adb.org/sites/default/files/publication/29724/food-security-poverty.pdf Balasubramanyam, V.N., Salisu, M. & Sapsford, D. (1999). Foreign direct investment as an engine of growth. The Journal of International Trade & Economic Development, 8, 27-40. Retrieved from http://web.a.ebscohost.com.ezproxy.lib.purdue.edu/ehost/pdfviewer/pdfviewer?sid=d4ebfd47-ded7-44ac-a654-e92a0d1c2584%40sessionmgr4005&vid=1&hid=4206 Basu, P. & Guarigalia, A. (2007). Foreign direct investment, inequality and growth. Journal of Macroeconomics, 29, 824-839. doi: 10.1016/j.jmacro. 2006.02.004 Food and Agricultural Organization (FAO). (1996). Rome declaration on world food security. Retrieved from http://www.fao.org/docrep/003/w3613e/w3613e00.htm Food and Agricultural Organization. (2013). FAO statistical year book 2013. Retrieved from http://www.fao.org/docrep/018/i3107e/i3107e00.htm Gollin, D., Parente, S.L & Rogerson, R. (2006) The food problem and the evolution of international income levels. Journal of Monetary Economics, 54, 1230-1255. doi: 10.1016/j.jmoneco.2006.04.002 Institute of Medicine. (2005) Dietary reference intakes for energy, carbohydrate, fiber, fat, fatty acids, cholesterol, protein, and Amino Acids (Macronutrients). Washington, CD: The National Academies Press. Jenkins, J. C. & Scanlan, S. (2001) Food security in less developed countries, 1970 to 1990. American Sociological Review, 66,718-744. Retrieved from http://www.jstor.org.ezproxy.lib.purdue.edu/stable/10.2307/3088955?origin=crossref& Makki, S. S., & Somwaru, A. (2004). Impact of foreign direct investment and trade on economic growth: evidence from developing countries. American Journal of Agricultural Economics, 86(3), 795-801. Mihalache-O’Keef, A. & Li, Q. (2011). Modernization vs. dependency revisited: Effects of foreign direct investment on food security in less developed countries. International Studies Quarterly, 55, 71-93. doi: 10.1111/j.1468-2478.2010.00636.x World Health Organization. (n.d. ). Food security. Retrieved from http://www.who.int/trade/glossary/story028/en/ United Nations Conference on Trade and Development. (n.d.) Inward and outward foreign direct investment flows, annual, 1970-2013 [Data file] Retrieved from http://unctadstat.unctad.org/wds/TableViewer/tableView.aspx?ReportId=88United Nations United Conference on Trade and Development. (n.d.) GDP by type of expenditure and Value Added by kind of economic activity, annual, 1970-2012 [Data file]. Retrieved from http://unctadstat.unctad.org/wds/TableViewer/tableView.aspx?ReportId=95 World Bank. (2006). Repositioning nutrition as central to development: A strategy for large-scale action. Why invest in nutrition? Retrieved from http://siteresources.worldbank.org/NUTRITION/Resources/281846-1131636806329/NutritionStrategyCh1.pdf World Bank. (n.d.) Food production index (2004-2006=100) [Data file]. Retrieved from http://databank.worldbank.org/data/views/reports/tableview.aspx World Bank. (n.d.) Prevalence of Undernourishment (% of population) [Data file]. Retrieved from http://databank.worldbank.org/data/views/reports/tableview.aspx
+Thank You
+Foreign Direct Investment
“Foreign direct investment are the net inflows of investment to acquire a lasting management interest (10 percent or more of voting stock) in an enterprise operating in an economy other than that of the investor. It is the sum of equity capital, reinvestment of earnings, other long-term capital, and short-term capital as shown in the balance of payments.” (World Bank)
+FDI Inflows in ASEAN
+Food Security in ASEAN
+Prevalence of Undernourishment
0.00
5.00
10.00
15.00
20.00
25.00
30.00
35.00
40.0037.07%
14.72%
Prevalence of Undernourishment (%) in ASEAN (1991-2011)
Year
Prev
alen
ce o
f U
nder
nour
ishm
ent
(%)
+
Political StabilityIn Myanmar, since the outbreak of internal violence in 2012, 140,000 people remain internally displaced and need food assistance.
World Food Programme (2014) . Retrieved from https://www.wfp.org/sites/default/files/imagecache/600x400/WFP_MYA_2014_Ayuka%20(113).jpeg