亚开行-新冠疫情对外商直接投资的影响（英）-2022.3-27页_679kb

报告摘要

Summary of "The Effect of COVID-19 on Foreign Direct Investment"

Core Content

This working paper by Kazunobu Hayakawa, Hyun-Hoon Lee, and Cyn-Young Park investigates the impact of the COVID-19 pandemic on foreign direct investment (FDI), specifically analyzing how the severity of the pandemic affects greenfield FDI and cross-border mergers and acquisitions (M&A) in the manufacturing and service sectors across 173 home countries and 192 host countries from Q1 2019 to Q2 2021.

The study uses three indicators to measure the severity of the pandemic: the number of confirmed cases, the number of deaths, and the stringency index of government policies. It also introduces fixed effects to control for unobservable factors such as trade agreements, economic conditions, and seasonal variations.

Main Findings

Heterogeneous Effects by Sector and Entry Mode

Manufacturing Sector:
- The severity of the pandemic in host countries significantly negatively affects both greenfield FDI and cross-border M&A.
- The pandemic situation in home countries does not have a significant impact on FDI flows.
- When allowing for a one-quarter lag, the home country's impact on M&A becomes negatively significant.
Service Sector:
- The severity of the pandemic in both host and home countries has a significant negative impact on greenfield FDI.
- The effect on cross-border M&A is mostly insignificant.
- When allowing for a one-quarter lag, the home country's impact on M&A becomes negatively significant.

Key Differences Between Greenfield FDI and Cross-border M&A

Greenfield FDI is more susceptible to pandemic impacts due to the need for physical infrastructure and on-site operations, which are disrupted by lockdowns and mobility restrictions.
Cross-border M&A is less affected because it involves acquiring existing assets and can be executed more quickly without the need for extensive planning or construction.
However, severe damage in host countries may lead to "fire-sale FDI", where firms are valued lower and thus more attractive for M&A.

Methodology

The authors use a Poisson pseudo maximum likelihood (PPML) estimation method to account for zero-valued FDI and non-linear relationships.
Data sources:
- Greenfield FDI data from fDi Markets (Financial Times Ltd.).
- Cross-border M&A data from Zephyr (Bureau van Dijk).
Variables included:
- FDI flows: measured in US dollar values and number of deals or projects.
- Pandemic indicators:
  - Number of confirmed cases and deaths in host and home countries.
  - Stringency index of government policies.
- Fixed effects:
  - Country pair-year fixed effects to control for annual trends and trade/investment agreements.
  - Country pair-quarter fixed effects to control for seasonality.
  - Year-quarter fixed effects to control for global income variations and pandemic-related global shocks.

Empirical Results Overview

Manufacturing Sector

Host country indicators (confirmed cases, deaths, stringency) have negative and significant effects on both greenfield FDI and M&A.
Home country indicators have positive or insignificant effects, suggesting that FDI from more affected home countries may shift to less affected host countries.
The number of FDI projects is more sensitive to changes in pandemic severity than US dollar values.

Service Sector

Host and home country indicators have negative and significant effects on greenfield FDI, but no significant effect on M&A.
The effect of home country indicators on M&A becomes significant when a one-quarter lag is considered.

Conclusion

The pandemic had a more pronounced effect on FDI in the service sector compared to the manufacturing sector, particularly for greenfield FDI.
Home country conditions had a limited impact on FDI in the manufacturing sector but more influence on M&A in the service sector when considering a lagged effect.
The study highlights the importance of pandemic severity in shaping FDI flows and suggests that FDI decisions are influenced by the interplay of host and home country conditions.

Key Information

Global greenfield FDI in the manufacturing sector decreased by 44.7% in 2020.
Global cross-border M&A in the manufacturing sector decreased by 19.4% in 2020.
Global greenfield FDI in the service sector decreased by 30.5% in 2020.
Global cross-border M&A in the service sector decreased by 7.2% in 2020.
The stringency index is used as a composite measure of government responses, with a value range of 0–100.
The study uses a lagged approach to capture the delayed effects of the pandemic on FDI decisions.
The number of cases and deaths are log-transformed in the regression models.
The effect of the number of cases or deaths is interpreted as per capita due to the inclusion of country pair-year fixed effects.

References

The paper cites various studies on the impact of financial crises and natural disasters on FDI.
It references Fang, Collins, and Yao (2021) and Fu, Alleyne, and Mu (2021) for earlier studies on the topic.
The paper also references Carril-Caccia and Pavlova (2018) and Aizenman and Noy (2006) for the complementarity between intermediate goods trade and FDI.