Foreign direct investment is the largest source of external funds in both developed and developing countries. Some literature explains that one of the barriers to investment flow is corruption. Thus, this study aims to determine the effect of corruption as measured by the corruption perception index on foreign direct investment. Corruption is a political risk that affects the flow of foreign direct investment. The estimation results of the Generalized Method of Moment (GMM) show that the corruption perception index has a significant positive effect on foreign direct investment. The author also uses market seeking and efficiency seeking variables as potential factors that influence investors to direct foreign direct investment.
This study investigates the potential horizontal and vertical spillovers from FDI towards firms' efficiency level on Indonesian manufacturing industries, using firm-level panel data. The result suggests that positive evidence of horizontal spillovers arise instantaneously, but the impacts of vertical spillovers appear a year later. These indicate that foreign competitors cause local firms more efficient in the same industry. Furthermore, after one period of time MNCs running their business in Indonesia, they bring positive impacts on downstream markets but deteriorate manufacturing industries in the upstream markets. Therefore, the Indonesian government must ensure that overall benefits from promoting FDI must overweight their negative impacts.
This study aims to examined the effect of cash flow and growth opportunity to the investment, and whether the exclusive relationship owned by the company with a government owned bank relationship moderates the effect of cash flow and growth opportunity on investment. This study used a sample of data from 101 manufacturing companies listed on the Indonesia Stock Exchange in the period 2013-2017. The multiple linear regression results show that cash flow and growth opportunity have a significant positive effect on investment, the government owned bank relationship weakens the effect of cash flow on investment but strengthens growth opportunity's influence on investment. This means that if the company has an exclusive relationship with a state-owned bank, it will reduce the dependence of cash flow to invest and increase investment opportunities.
The 2007 Indonesian investment law granted national treatment for foreign investors, establishing a transparent 'negative list' for out-of-bonds investment sectors, and has been considired as a reformative regulation in Indonesia's economic strategy. However, decentralized systems give autonomy to local governments to manage their projects and infrastructure themselves. This leads into increasiig investment burdens through their opaque measures that are creating perceptions of risk for foreign investors. As a result, lack of legal certainty, inconsistent regulations and judiciary system would hamter investments. This article argues that law 25/2007 should be supported by a comprehensive investment policy to attract more foreign investors into Indonesia. A key element in establishing a competitive region is a free and open investment regime, This article addresses policy impediment to private investment in Indonesia as well as in the ASEAN region. Indonesia and ASEAN should have non-discriminatory treatment extended to foreign investors including ASEAN-based inveitors, as the establishment of ASEAN Economic community (AEC) will cornmence in 2015. Legal certainty of international business transaction by private investors is fostering investments by both direct investment and indirect investment (portfolio). Parties to investment agreements include individuals, small, medium and large multinational corporations, and countries. In this centralized global atmosphere, the Indonesian agovemment has to provide guarantees to leverage private investments.
In this report we aim to analyse the economic and environmental impacts of Pillar I direct payments, and to demonstrate alternative instruments that are better suited to achieve CAP objectives. The instruments—a targeted payment to land at risk of abandonment and a tax on mineral fertilisers—were selected on the basis of the Polluter Pays and Provider Gets Principles. We do this using two state‐of‐the‐art agricultural economic simulation models. The first model, CAPRI, is used to quantify the large‐scale or aggregate impacts for individual countries, the EU and the world. The other model, AgriPoliS, is used to quantify the fine‐scale or farm and field level impacts in a selection of contrasting agricultural regions, to consider the potential influence of the large spatial variability in agricultural and environmental conditions across the EU. The results show that direct payments are keeping more farms in the sector and more land in agricultural use than would otherwise be the case, and thus avoiding land abandonment, principally in marginal regions. Particularly the area of grassland is substantially higher, because it is generally less productive than arable land and hence more dependent on direct payments for keeping it in agricultural use. The magnitudes of the impacts of direct payments on land use therefore vary strongly across regions due to spatial variability in productivity: marginal regions with large areas of less productive land are heavily influenced by direct payments, while regions with large areas of relatively productive land are hardly affected, because this land would be farmed in any case. By keeping more farmers in the sector longer, direct payments are slowing structural change, which can hamper agricultural development. However the potential benefits of faster structural change vary considerably among our study regions. In relatively productive regions direct payments are hindering development, because too many farmers are staying in the sector and preventing the consolidation of land in larger farms, which would improve their competitiveness and increase farm profits. On the contrary, the mass departure of farms that is currently avoided, will not lead to the same general benefits in marginal regions. Instead of freed land being absorbed by remaining farms, large areas of relatively unproductive land are abandoned without payments. This land is unprofitable to maintain in agricultural land use, even if integrated into larger farms, because current market prices are too low to motivate farming it. Consequently direct payments pose a serious goal conflict: the avoidance of land abandonment on the one hand, which can have negative impacts on public goods, and restricting agricultural development on the other hand. Once again this goal conflict is rooted in the spatial variability of agricultural conditions in the EU. Maintaining extensively managed farmland, particularly semi‐natural pastures, is central for conservation of biodiversity and preservation of the cultural landscape. Therefore direct payments are contributing to the provisioning of these public goods, but principally in marginal areas. Further, abandonment of land can reduce its agricultural productivity due to erosion or afforestation. Thus, direct payments are contributing to food security by preserving the productive potential of land for the future, but only marginal land since relatively productive land is farmed in any case. Production of agricultural commodities is affected to a lesser degree by direct payments than land use per se. Nevertheless, food exports from the EU are higher and imports lower as a consequence of direct payments. However, the additional supply generated by direct payments also lowers output prices, which reduces the profitability of commodity production; thereby partially offsetting the additional revenues from direct payments. The higher agricultural output brought about by direct payments causes higher levels of environmentally damaging greenhouse‐gas emissions, nutrient surpluses and pesticide use. The higher greenhouse‐gas emissions for the EU are, to some extent, moderated by lower emissions in the rest of the world. Nevertheless, the net effect of direct payments is higher global emissions of greenhouse gases. The environmental impacts of higher nutrient surpluses and pesticide inputs are less conclusive, since these depend also on spatial factors, i.e., where the emissions occur. Although EU‐scale and regional emissions are higher due to direct payments, agricultural production is less intensive generally, on account of the lower output prices. Analysing the net effects of these two opposing forces requires additional biophysical modelling at relevant spatial scales, such as watersheds or landscapes, which is beyond the scope of this study. Pillar I direct payments generate a significant transfer of income to farmers and land owners who are not necessarily farmers; 40 billion euro annually. Of this transfer a substantial proportion goes to farmers in relatively productive regions and, further, to a minority of farmers that need them least. In relatively productive regions payments are not needed for continued agricultural production and preservation of farmland, but instead rather fuel higher land and rental prices, which hampers structural change. On the contrary, the need for support is greatest in marginal regions, because some form of payment to marginal land is needed to avoid its abandonment and the loss of associated public goods. Finally, the direct payments even come at the cost of lower market returns for farmers due to slower structural change (smaller and less competitive farms) and lower output prices (due to greater EU output). On the other hand the lower output prices lead to somewhat lower food prices, but at the greater cost of financing the direct payments. Our main conclusion is that Pillar I direct payments are generating serious goal conflicts due to spatial variability in conditions across the EU. On the one hand these payments are contributing to the provisioning of public goods by preserving marginal agricultural land. On the other hand they are hampering agricultural development, primarily in relatively productive regions. Payments to relatively productive land that would be farmed any way not only inflate land values (capitalisation) but also slow structural change, which are both likely to hinder agricultural development and hence the competitiveness of the EU on the global market. The direct payments also increase environmental pressure; by subsidising land use generally and the associated production, they are incapable of controlling environmentally damaging emissions, which is also in conflict with broad CAP objectives. The goal conflict arises because direct payments are universal, a payment principal that does not consider spatial variability in the EU and the associated trade‐offs in regard to development and environmental effectiveness. Our analysis considered two alternative policy instruments that have the potential to curb the identified goal conflicts associated with direct payments, by applying the Polluter Pays and Provider (of public goods) Gets Principles at appropriate spatial scales. Replacing direct payments with a payment targeted on marginal land (and associated public goods) prevents land abandonment at a lower cost, by avoiding payments to relatively productive land that is farmed in any case. This also allows surviving farms in regions with relatively productive land to compensate for lost direct payments through expansion and associated scale economies, as well as higher output prices. This instrument therefore finances the provisioning of public goods without adverse effects on development and the efficiency of agricultural production. The EU‐wide tax on mineral fertiliser demonstrates that this instrument has the potential to reduce nutrient surpluses. Since direct payments cause higher levels of polluting emissions, policy instruments targeting emissions at relevant spatial scales are needed to achieve cost‐effective abatement. Overall we find that Pillar I direct payments are not addressing the diversity of challenges facing European agriculture. In fact our quantitative analysis indicates that the potential for the current system to meet these challenges is seriously impaired by goal conflicts and spatial variability across the EU. A better policy requires that instruments are targeted on desired outcomes and designed according to sound principles, specifically the Polluter Pays and Provider Gets Principles. These principles would ensure that farmers are provided with appropriate incentives to i) generate public goods that otherwise would be underprovided; ii) mitigate environmentally damaging emissions at the lowest possible cost to society; and iii) continually strive to improve environmental performance. Such instruments are also fairer and promote a more competitive or viable agricultural sector by not obstructing structural change and hence agricultural development.
This paper analyses the important of regional investment agreements for promoting international trade in ASEAN countries. To visualize the above idea, this work will explain the roles of regional investment agreements to serve investment, trade facilitation and to protect regional investment interests. It is argued that regional investment agreements can serve as a vehicle for dialogue, coordination on and to response regional issues including regulatory harmonization, infrastructure development, and collaboration among members to facilitate investment. The paper shows how regional agreements will commit to eliminate barriers on substantially trade and investment, create positive welfare gains, the productivity and stimulus to growth in the region. This paper also analyses the effect of the establishment of an ASEAN Economic Community (AEC) by 2015 to the regional investment policies. AEC aiming at transforming ASEAN into a single market and production base with a highly competitive economic region, equitable economic development, free movement of goods, services, investment, skilled labor, and freer flow of capital, will likely accelerate regional integration and cooperation in the investment sectors fully integrated into the international trade. Then, this work demonstrates the implementation of regional investment cooperation into the formal instruments/agreements of investment policy architecture promoting and protecting cross border investment among nationals of ASEAN member states, such as ASEAN Investment Guarantee Agreement (IGA), the ASEAN Investment Area (AIA) and ASEAN Comprehensive Investment Agreement (ACIA). However, it is realized that the ASEAN members may resist and protest against the regional investment agreements because of conflicting their national interest. The paper proposed that the regional inv stment agreements need to be strengthened by harmonization and structural adjustment due to the member's resistance and protest. This idea may spark challenge because each member has fundamental differences on the nature and character of legal and economic systems reflecting different political systems, economic and social cultures in accordance with the philosophy of life values and national interests of each country. To overcome the challenge, this paper argues that ASEAN member countries need to unilaterally and collectively come up with structuring trade and investment policy harmonization to move ahead and reap the benefits from regional investment agreement as a common tool for contesting their interest in international trade. In addition, pre agreed flexibilities to accommodate the interests of all ASEAN countries may eliminate the problem.
The purpose of IPBES assessments is to depict how the natural world and human societies interact with each other on a conceptual level. Habitat degradataion, eutrophication, fishing and climate change are examples of drivers of change that affect Nordic coastal habitats. Policy and governance are principal indirect drivers that both could lead to decline and deteriorations, as well as improvements and recoveries environments. Climate change will affect Nordic marine biodiversity profoundly in the future by changes in, for example, bio-chemical cycles and in the distribution of biodiversity. Such changes might lead to increased oxygen depletion in many areas, leakage of nutrients, changed thropic structures and spread of pathogens. It is therefore of paramount importance that effective governance is developed to mitigate impacts on nature's contributions to people (NCP) and to build sustainability and strategies for sustainability. Less overfishing, less euthropication, fewer pollutants and better land-use and nature protection are measures that will improve the overall resilience of Nordic coastal environments.
The main objective of WTO Law is to accommodate individual's right in order to obtain better benefit of international trade. However, when a government violates WTO Law, it is therefore causing deprivation of individual right itself. Direct effect seems to be a feasible doctrine to provide a judicial protection for individual, in order to rebalance the right that is violated. Nevertheless, this doctrine is intractable to imply. This article discuss the polemic of giving direct effect of WTO Law and DSB Decision to domestic law to provide judicial protection for individual who becomes victim of WTO violation conducted by government
The purpose of this study is to ascertain the causal link between corruption and sustainable development. The Corruption Perception Index (CPI), Human Development Index (HDI), Carbon Dioxide Emissions (CO2), and Foreign Direct Investment (FDI) variables were used in this study. The data for this analysis were derived from secondary sources such as the World Bank, the United Nations Development Programme, and Transparency International. The stationary test, cointegration test, optimum lag test, and Granger causality test were all employed in this study. The study's findings indicate that corruption and sustainable development are causally related. Corruption and sustainable development have a two-way causative link from a socioeconomic viewpoint, a one-way causal relationship from an environmental perspective, and a one-way causation relationship between corruption and foreign direct investment. Corruption has proven to be an obstacle to the sustainable development of every country.
The purpose of this study was to investigate the mediating impact of psychological capital and job relevant information on the budget participation to job performance at the public sector managers in the provincial government of East Java. Data analyzed using SEM-PLS. The SEM-PLS allows the examination of the direct effects of budget participation on job performance and the indirect effects between budget participation and job performance that run through psychological capital and job relevant information. The findings of this study are that psychological capital fully mediates influence of budget participation to job performance, job relevant information fully mediates influence of budget participation to job performance. Limitations of this study are using questionnaire media to obtain primary data so that it relies on the level of respondent perception so that the subjectivity factor can be contained in it. Second limitation is generalizability of samples. Despite its limitations, this study has both academic and practical implications. The study adds to the job performance literature in a public sector organizations. The study also finds that manager's job performance can be improved by minimizing Psycap and JRI. Future research should study other mediation variables on the effect of budget participation on job performance.
This study examines the impact of foreign presence in the Medium-High and High technology manufacturing industry in Indonesia. Using a balanced panel data that consists of 2,397 firms and in the year of 2010-2014, the data was estimated using the multiple regression method. The results show that there is positive spillover when local and foreign firms are in the same industry. Conversely, in different industries, negative spillover occurs in forward linkage when local firms buy the output of foreign firms and no spillover occurs in backward linkage when local firms become the suppliers of foreign firms. The Indonesian government must assure that foreign investment policies must benefit the domestic companies, considering there are some potential losses for domestic enterprises by the presence of foreign direct investment in the domestic market.
The application of public policy as an activity in the public policy process is often contrary to what is expected, and even makes policy products a stumbling block for policy makers themselves. That is the implementation of public policy. This requires a deep understanding of public policy studies. The research objective that the researchers conducted was to analyze and analyze the implementation of the Direct Cash Assistance Program (BLT) in Pasanggrahan Baru Village, Sumedang Selatan District, Sumedang Regency. See and analyze the constraints in the Implementation of Direct Cash Assistance Program (BLT) Policy in Pasanggrahan Baru Village, Sumedang Selatan District, Sumedang Regency. As well as to find out and analyze what preventive measures were taken to overcome obstacles in the implementation of the Direct Cash Assistance Program (BLT) Policy in Pasanggrahan Baru Village, Sumedang Selatan District, Sumedang Regency. The research method used in research using qualitative methods. Qualitative research to understand social phenomena from the perspective of participants. From this study found obstacles related to the Implementation of the Direct Cash Assistance Program (BLT) Policy in Communities Affected by Covid-19 in Pasanggrahan Baru District, South Sumedang Regency, Sumedang Regency, both related to communication, resources, disposition and bureaucratic structures. Enduring the obstacles that have been done is also an effort to overcome the obstacles that have occurred. So that the purpose of implementing the Direct Cash Assistance Program (BLT) Policy for Communities Affected by Covid-19 in Baru Pasanggrahan Village, Sumedang Selatan District, Sumedang Regency can be carried out as expected. ; The application of public policy as an activity in the public policy process is often contrary to what is expected, and even makes policy products a stumbling block for policy makers themselves. That is the implementation of public policy. This requires a deep understanding of public policy studies. The research objective that the researchers conducted was to analyze and analyze the implementation of the Direct Cash Assistance Program (BLT) in Pasanggrahan Baru Village, Sumedang Selatan District, Sumedang Regency. See and analyze the constraints in the Implementation of Direct Cash Assistance Program (BLT) Policy in Pasanggrahan Baru Village, Sumedang Selatan District, Sumedang Regency. As well as to find out and analyze what preventive measures were taken to overcome obstacles in the implementation of the Direct Cash Assistance Program (BLT) Policy in Pasanggrahan Baru Village, Sumedang Selatan District, Sumedang Regency. The research method used in research using qualitative methods. Qualitative research to understand social phenomena from the perspective of participants. From this study found obstacles related to the Implementation of the Direct Cash Assistance Program (BLT) Policy in Communities Affected by Covid-19 in Pasanggrahan Baru District, South Sumedang Regency, Sumedang Regency, both related to communication, resources, disposition and bureaucratic structures. Enduring the obstacles that have been done is also an effort to overcome the obstacles that have occurred. So that the purpose of implementing the Direct Cash Assistance Program (BLT) Policy for Communities Affected by Covid-19 in Baru Pasanggrahan Village, Sumedang Selatan District, Sumedang Regency can be carried out as expected.
