Economic impact of flooding on agricultural production in Malaysia

The flood disaster in Malaysia can result in many losses especially in economy, destruction of natural resources, and destruction of the environment including in the agricultural sector. Plants die when flood water remains in agricultural areas for too long. Farmers will suffer economically if their crops are destroyed. In general, agricultural production will be negatively affected. Therefore, this research was conducted to examine the impact of flooding on agricultural production in Malaysia. This study uses secondary data from 2002 until 2021 from the Department of Irrigation and Drainage Malaysia (DID) and the World Bank. The method used in this study is Time Series Data Analysis by using autoregressive and distributed lag model (ARDL) test. This method used to establish a long-run cointegration relationship between the variables. Throughout the study period, there was no significant correlation between Malaysia’s agricultural production and the flood. This suggests that, over an extended period of time, the flood has little effect on Malaysia’s total agricultural productivity. Therefore, we recommend that Malaysian government should invest in modernizing and diversifying the agricultural sector, focus on developing and maintaining robust infrastructure, including water reservoirs, drainage systems, and flood barriers, and establish financial instruments and insurance mechanisms.