Communicable Illness and Foreign Direct Investment (FDI) Flows

Foreign Direct Investment (FDI) plays a fundamental role in enhancing economic growth and the integration of the global economy. The level of market maturity and the status of export platform are important factors in determining the amount that a state receives. Basically, communicable diseases are a major threat to the health of human capital. However, the illnesses have a negative effect on Foreign Direct Investment. Apparently, population health, per capita Gross Domestic Product, and FDI are interconnected concepts in the overall economy. Communicable diseases such as HIV/AIDS, Ebola, and tuberculosis are closely related to flow of Foreign Direct Investment (FDI).

• HIV/AIDS, as one of the transmittable illnesses, has a negative effect on Foreign Direct Investment. The health of the human capital in a country has an impact on the economy and investment models.
• According to Asiedu, Elizabeth, Yin Jin, and Issac (13), HIV/AIDS is one of the serious threats to the successful operation of businesses. In fact, the working class is the group that is more susceptible to HIV/AIDS among other communicable illnesses. For these reasons, the illnesses has resulted in a reduction of the number of people in the workforce. Besides, the illness results in increased absenteeism and low productivity among the workers. The spread of the disease has led to declined population, thus, causing a shrinking market for businesses.
• Notably, FDI is crucial in economic growth although most of the research findings do not take account of the effect of the health issue on FDI. HIV/AIDS is a global epidemic that affects overall human development. In fact, HIV and other transmittable illnesses such tuberculosis are the leading cause of deaths among the population.
• Azomahou, Theophile, Raouof Boucekkine, and Bity Diene (472) argue that one of the peculiarities of HIV/AIDS, communicable illness, is the high rates of morbidity and mortality associated with the illness. In the workplace, the death of one of the member of staffs might affect the overall morale of the remaining employees in a company (Asiedu et al 12). Additionally, the uninfected persons might be afraid to interact with the infected persons, thus, affecting teamwork and overall productivity in the workplace. The overall output of the workers depends on the competence of the coworkers. Therefore, it is apparent that infected persons might lower the overall productivity among other employees.
• The HIV prevalence varies across different states. It is more prevalent in the developing countries. Among all other infectious illnesses, HIV/AIDS has more adverse effects on the overall health levels. In fact, most of the researchers recognize the illness one of the factors that has effects on the overall per capita income and development of infrastructure. The existing market must achieve a specific threshold for a realization of positive impacts. However, weak institutions and political instability might affect Foreign Direct Investment.
• Burns, Darren, Andrew,  Yevheniy, Goryakin, and Marc (76) contend that communicable illnesses such as HIV/AIDS and tuberculosis have effects of technological development and other economic processes in a country. The government spends part of the Gross Domestic product to provide medications to the infected persons, which eventually affects the FDI. In most cases, communicable illnesses are still the leading causes of morbidity and mortality among the people.

In conclusion, communicable illnesses have negative effects on the investment options. Additionally, the prevalence of the illness diminishes the inflows of Foreign Direct Investment (FDI). In the workplace setting, HIV/AIDS is one of the major communicable illness that affects the overall productivity among the employees. Primarily, the infected workers are less productive and less willing to cooperate with others in an organization. Therefore, it is apparent that HIV/AIDS has negative effects on the overall (FDI).

Appendix

Fig 1.1( Elemo 4)

The figure 1.1 illustrates the high prevalence of HIV/AIDS among the people aged 15-49)

Fig 1.2(DAC Journal Development Cooperation 6)

The figure Indicates the flow of funds from foreign nations to the developing nations.

Works Cited 

Asiedu, Elizabeth, Yi Jin, and Isaac K. Kanyama. “The impact of HIV/AIDS on foreign direct investment: Evidence from Sub-Saharan Africa.” Journal of African Trade 2.1-2 (2015): 1-17.

Azomahou, Théophile T., Raouf Boucekkine, and Bity Diene. “HIV/Aids and development: A reappraisal of the productivity and factor accumulation effects.” American Economic Review106.5 (2016): 472-77.

Burns, Darren K., Andrew P. Jones, Yevgeniy Goryakin, and Marc Suhrcke.. “Is foreign direct investment good for health in low and middle income countries? An instrumental variable approach.” Social Science & Medicine 181 (2017): 74-82.

 Elemo, Ibrahim. “The State Of HIV/AIDS In Oromia And Among Oromo Diaspora.” Oromedia.Wordpress.Com, 2008, https://oromedia.wordpress.com/the-state-of-hivaids-in-oromia-and-among-oromo-diaspora/.

 DAC Journal Development Cooperation. “Chart I-5. Flow Of Funds From DAC Countries And International Organizations To Developing Countries ｜ Japan’s ODA White Paper 2005 ｜ Ministry Of Foreign Affairs Of Japan.” Mofa.Go.Jp, 2013, http://www.mofa.go.jp/policy/oda/white/2005/ODA2005/html/zuhyo/zu010051.htm.