Can outward foreign direct investment support home-country agri-food supply chain resilience?

Purpose Agri-food supply chains (AFSCs) are vulnerable to disruptive shocks, making supply chain resilience critical for continuous food supplies. Developing countries are under-prepared and over-exposed to shocks, and their strategies to build supply chain resilience remain limited in scope. The purpose of this study is to explore whether outward foreign direct investment (OFDI) could serve as an innovative strategy for developing countries to improve home-country AFSC resilience, using the case of the 2008 Chinese melamine crisis. Design/methodology/approach This study uses a novel theoretical intersection between supply chain resilience and OFDI theory. Applying conditional logistic regressions to Chinese dairy investment data between 2008 and 2020, collected from Thomson Reuters, the Financial Times and the Chinese Global Investment Tracker, the paper analyses key resilience elements including redundancy, flexibility and visibility to explore potential OFDI strategies. Findings Results show that strategies aimed at reducing AFSC vulnerabilities appear favoured in international investment decisions over those promoting closer partner linkages. This emphasises firms may stabilise domestic AFSCs following shocks by investing internationally in host countries with excess capacities. Originality/value The study introduces OFDI as a potential strategy for enhancing home-country AFSC resilience, an angle largely absent from current research. It contributes novel empirical insights in a field where quantitative studies remain scarce and suggests policy makers in developing countries could learn from the Chinese experience when dealing with shocks. Novel policy instruments - such as capital controls and food safety regulation - could be considered to proactively enhance AFSC resilience by incentivising OFDI.