Haiti's Political Turmoil: An Examination of its Implications on Foreign Direct Investment

Year 2023, Volume: 5 Issue: 4, 248 - 258, 30.12.2023

Pierre Richard Louıs-jacques , Sheikh Abdul Kader

https://doi.org/10.54821/uiecd.1396044

Abstract

Haiti is a country with a history of political instability and faces considerable challenges in attracting foreign direct investment (FDI). This study investigates the impact of political turmoil on FDI in Haiti from 1994 to 2020. The study relies on secondary data obtained from sources such as International Financial Statistics (IFS), World Development Indicators(WDI), and the International Country Risk Guide (ICRG). The study utilizes the Vector Error Correction Model (VECM) and the Dynamic Ordinary Least Squares (DOLS) statistical technique. The findings indicate that, over the long run, political instability and inflation have an adverse influence on FDI in Haiti. Conversely, exchange rate, interest rate, and trade openness positively affect FDI. However, these variables do not directly drive FDI in the short term but are influenced by external factors. This paper emphasizes the critical role of establishing a stable political environment, effectively managing inflation, and maintaining competitive exchange rates and interest rates to enhance FDI attraction. Additionally, promoting trade openness is deemed crucial.

Keywords

Political instability, Foreign direct investment, Haiti

Haiti'nin Siyasi Çalkantısı: Doğrudan Yabancı Yatırım Üzerindeki Etkilerinin İncelenmesi

Abstract

Haiti, siyasi istikrarsızlık geçmişine sahip ve doğrudan yabancı yatırım (FDI) çekme konusunda önemli zorluklarla karşı karşıya olan bir ülkedir. Bu çalışma, 1994-2020 yılları arasında Haiti'deki siyasi çalkantının FDI üzerindeki etkisini incelemektedir. Çalışma, Uluslararası Finans İstatistikleri (IFS), Dünya Kalkınma Göstergeleri (WDI) ve Uluslararası Ülke Risk Rehberi (ICRG) kaynaklardan elde edilen ikincil verilere dayanmaktadır. Çalışma, Vektör Hata Düzeltme Modeli (VECM) ve Dynamic Ordinary Least Squares (DOLS) istatistiksel tekniği kullanmaktadır. Bulgular, uzun vadede siyasi istikrarsızlık ve enflasyonun Haiti'deki FDI üzerinde olumsuz bir etkisi olduğunu göstermektedir. Bununla birlikte, döviz kuru, faiz oranı ve ticaret açıklığı FDI'yi olumlu etkiler. Ancak bu değişkenler kısa vadede doğrudan yabancı yatırımları yönlendirmemekte, dış faktörlerden etkilenmektedir. Bu çalışma, doğrudan yabancı yatırım çekiciliğini artırmak için istikrarlı bir siyasi ortam oluşturmanın, enflasyonu etkili bir şekilde yönetmenin ve rekabetçi döviz ve faiz oranlarını sürdürmenin kritik rolünü vurgulamaktadır. Ayrıca, ticari açıklığın teşvik edilmesinin de önemli olduğu değerlendirilmektedir

Keywords

Siyasi İstikrarsızlık, Doğrudan Yabancı Yatırım, Haiti

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