Natural disasters and FDI inflow in the developing countries of South-Eastern Asia
Natural disasters and FDI inflow in the developing countries of South-Eastern Asia

Summary/Abstract: The purpose of this paper is to investigate the impact of catastrophic events on FDI inflow in five developing countries with high catastrophic risk of South-Eastern Asia region, i.e. Indonesia, Malaysia, Philippines, Thailand and Vietnam. With the use of the OLS method I estimate the model in which the dependent variable is FDI inflow as a percent of GDP. Among explanatory variables I have included the number of natural disasters as well as types of them per year in respective year and two years back, GDP growth, GDP per capita, inflation and total trade to GDP ratio. The results show a negative correlation between FDI inflow and the occurrence of natural disasters for Thailand and Malaysia. In the remaining countries results do not give clear answer with respect to the relation between the number of disaster and investments in particular country.

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