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The Relationship between COVID-19 Pandemic, Foreign Direct Investment, and Gross Domestic Product in Indonesia

Author

Listed:
  • Ferry Syarifuddin

    (Bank Indonesia, Gedung D lantai 10, Jln. MH Thamrin No. 2, Jakarta 10350, Indonesia)

  • Maman Setiawan

    (Department of Economics, Faculty of Economics and Business, Universitas Padjadjaran, Bandung 40132, Indonesia)

Abstract

This research investigates the impact of the COVID-19 pandemic on foreign direct investment. This research also studies the impact of the COVID-19 pandemic on the relationship between foreign direct investment (FDI) and the gross domestic product (GDP). This research employs a local projection estimation to calculate the effect of the COVID-19 pandemic on foreign direct investment. The panel vector autoregression is applied to estimate the impact of the COVID-19 pandemic on the relationship between FDI and GDP. This research finds variations in the impacts of the COVID-19 pandemic on FDI among economic sectors in Indonesia. Moreover, the relationship between FDI and GDP is affected by the COVID-19 pandemic.

Suggested Citation

  • Ferry Syarifuddin & Maman Setiawan, 2022. "The Relationship between COVID-19 Pandemic, Foreign Direct Investment, and Gross Domestic Product in Indonesia," Sustainability, MDPI, vol. 14(5), pages 1-16, February.
    • Handle: RePEc:gam:jsusta:v:14:y:2022:i:5:p:2786-:d:759934
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    References listed on IDEAS

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    2. Montfaucon,Angella Faith Lapukeni & Senelwa,Victor Kidake & Doarest,Aufa, 2023. "Early Impacts of Indonesia’s Investment Reforms : A Preliminary Analysis," Policy Research Working Paper Series 10478, The World Bank.

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