The role of sectoral FDI in promoting agricultural production and improving food security

Abstract

The aim of this paper is to examine the effects of foreign direct investments (FDI) on food security for 55 developing countries in a panel framework over the period 1995-2009. There are various measures of food security that can be used. Our first contribution is to build a composite indicator that synthesizes the food indicators used by the Food and AgricultureOrganization to measure the food availability and food utilization. Second, our empirical study is based on a model composed of a food security equation and an agricultural production equation. Our results show that sectoral FDI have different effects on food security. FDI in the agriculture sector improves food security and FDI in the secondary and tertiary sector increases the food insecurity. We found a significant FDI's spillover through the agricultural production to food security. While the effect is positive with FDI in secondary sector, it is negative for FDI in the tertiary sector.

Impact of foreign direct investment on greenhouse gas emissions in agriculture of developing countries

“…The results imply that although foreign direct investment in agriculture in developing countries often has positive effects such as production growth, increase in food availability, improved access to water, and improved sanitary production standards (Ben Slimane et al . ), there could also be negative effects, such as intensification of greenhouse gas emissions, which should not be neglected. The increase of emission intensity, which was shown to be potentially driven inter alia by foreign direct investment inflows, can cause climate externalities and worsen production conditions for all agricultural producers in a host country.…”

Analyzing the Relationship between Agricultural FDI and Food Security: Evidence from Belt and Road Countries

“…Wieck et al (2014) [17] found that good governance boosts food security, and good guidelines for investment will contribute and maintain their potential positive influence on economic development and food security. Ben Slimane et al (2016) [13] found that in developing countries the FDI in the agriculture sector supports food security, whereas FDI in the manufacturing and services sectors increases food insecurity. They also found a significant influence of FDI spillover on food security through agricultural production.…”

“…If we take each indicator of these four indicators separately, we will not get enough information to accurately represent the level of food security. So in Section 4.1, we present a composite indicator that can represent these four indicators together [13]. Figure 1 shows the study sample and levels of composite food security in each country.…”

“…Although lots of attention has been paid to the relationship between FDI and food security at the macroeconomic level, we found these studies have reached different conclusions and therefore they have not given a general impression of the relationship between agricultural FDI and food security. Some researchers found the relationship to be positive using simultaneous equations and ordinary least squares (OLS) models [13][14][15][16][17], and others found the relationship to be negative using OLS and applying a double-logarithm functional form [18,19]. While some previous researchers have considered only one country, others studied several countries.…”

Food Security Forecast within the Framework of Mankind Survival Strategy Concept in the Twenty-First Century

“…The studies reviewed the problems of increasing the efficiency of planning and forecasting of food security levels and the ways of its provision (Slimane et al, 2015;Moseley, 2015). Moreover, most of the studies present the results of long-term forecasting of food security level for 15-30 years (Van Dijk and Meijerink, 2014;Sreejith and Selvan, 2015;Van Wijk, 2014).…”