Search

Begin New Search Topic Foreign Direct Investment Content Type Commentary and Analysis

1. Timing Is Everything: Italy Withdraws from the Belt and Road Initiative

Author:
Aurelio Insisa
Publication Date:
12-2023
Content Type:
Commentary and Analysis
Institution:
Istituto Affari Internazionali
Abstract:
After months of rumours and speculations, on 6 December 2023, the Italian newspaper of record, the Corriere della Sera, broke the news that Rome had finally withdrawn from China’s Belt and Road Initiative (BRI), via a note sent to Beijing three days earlier.[1] In the absence of an explicit request to withdraw before the end of December, the memorandum of understanding (MoU) instrumental to Italy’s participation in the BRI would have automatically been renewed for another five years starting from March 2024. Italy’s subdued withdrawal from the BRI marked the epilogue of a long, laborious, yet ultimately successful diplomatic process that reflected a reassessment of its bilateral relations with China. The origins of this reassessment can be traced back to the government led by Mario Draghi between 2021 and 2022. In June 2021, during the first post-pandemic, post-Trump G7 Leaders’ Summit in Carbis Bay, Draghi stated that his government would “examine […] carefully” the MoU.[2] Draghi’s words reflected a deeper awareness of the broader implications of Beijing’s assertiveness in international politics and a close alignment with the Biden administration in Rome. This shift also reflected the absence of tangible economic benefits from BRI membership for Italy, although this was also due to the devastating effect of the Covid-19 pandemic on the designed trajectory of Sino-Italian economic relations.[3] Furthermore, the security-driven decision of the Draghi government to repeatedly exercise its “golden power” to veto Beijing’s investments in Italy’s strategic sectors contributed to shaping the MoU’s outcome.[4] This course correction in Rome’s China policy survived the fall of the Draghi government in July 2022 and the victory of the centre-right coalition led by Giorgia Meloni and her Fratelli d’Italia (Brothers of Italy, FdI) party in the legislative elections of September that year. After all, Meloni and her party had consistently opposed the MoU with China from the very beginning, a decision arguably also linked to the perceived need to bolster the party’s credentials as a reliable partner in the eyes of Washington – as in the case of the clear support for Ukraine well before the September electoral victory.
Topic:
Foreign Policy, Foreign Direct Investment, Belt and Road Initiative (BRI), and International Politics
Political Geography:
China, Europe, Asia, and Italy

2. Jagged Sphere: China’s quest for infrastructure and influence in mainland Southeast Asia

Author:
Greg Raymond
Publication Date:
06-2021
Content Type:
Commentary and Analysis
Institution:
Lowy Institute for International Policy
Abstract:
China has land borders with mainland Southeast Asia and strong strategic imperatives to develop land routes to the sea. It has both potential and motivation to pursue an infrastructural sphere of influence in the Mekong subregion through Belt and Road Initiative (BRI) projects joining southern China and mainland Southeast Asia. The poorer states, especially Laos and Cambodia, have been receptive to the BRI and infrastructure investment, but Thailand and Vietnam, strong states and protective of sovereignty, have been more cautious. This means China’s impact is significantly varied across the subregion. China’s Special Economic Zones (SEZs) in Cambodia, Laos, and Myanmar are in some cases dissolving borders and in others carving out Chinese-controlled enclaves, all increasing the People’s Republic of China (PRC) presence and influence.
Topic:
Infrastructure, Foreign Direct Investment, Regional Integration, Borders, and Belt and Road Initiative (BRI)
Political Geography:
China, Asia, Vietnam, Cambodia, Thailand, Southeast Asia, Laos, and Myanmar

3. Snakes, rats and drug addicts used to dwell here – analysis of the narrative utilised to capture the state

Author:
Luka Steric
Publication Date:
03-2021
Content Type:
Commentary and Analysis
Institution:
Belgrade Centre for Security Policy
Abstract:
Foreign direct investments are the cornerstone of the current government’s economic policy. In their statements, the officials call them drivers of development, saying that they have enabled the revival of the economy and turned Serbia into the “economic tiger of Southeast Europe.”1 The fact that the value of the investments Serbia has managed to attract is greater “than what was achieved by all the countries of the Western Balkans put together” 2 is often mentioned as the key measure of success. However, the story of brilliant success quickly loses its lustre when one considers the long-term effects and all-encompassing consequences of this policy. Due to the way they are contracted and implemented, foreign direct investments represent one of the key mechanisms for capturing the state. Hiding behind the stories of a better future and new jobs, the government is breaking down the system of legal regulations and statutory procedures, promoting private interest to the detriment of the public one, and using foreign investments as propaganda ammunition to legitimise unlimited power. The results of such policy are a number of negative consequences for the state and the citizens, such as the increase of public debt, dramatic violation of workers’ rights and alarming problems with environmental pollution. In order to mask the negative consequences and legitimise the policy of attracting foreign investors based on the above described pattern, a complex narrative has been developed presenting foreign investments as a successful, and the only possible, model for state development. This meta-narrative about progress, which media are building up every day, is based on four basic component narratives: on the economic revival, on the efficiency of personal rule, on transparent contracts and on the opponents of Serbia’s development who ‘unfoundedly’ criticise the government’s economic success. In the analysis of the narrative we will focus on the statements of officials made since 2012, which is when the regime led by the Serbian Progressive Party came to power. Many of the described mechanisms, such as non-transparent, harmful contracts and unjustifiably high subsidies, also existed during the previous government.3 However, the capture of the state, carried out - among other things - with the help of foreign direct investments, has reached completely new dimensions under the current regime, while the narratives that accompany it have been significantly ‘improved’.
Topic:
Development, Economics, Foreign Direct Investment, and Drugs
Political Geography:
Europe and Serbia

4. China: Economy, Energy and the Middle East

Author:
Paul Rivlin
Publication Date:
03-2019
Content Type:
Commentary and Analysis
Institution:
Moshe Dayan Center for Middle Eastern and African Studies
Abstract:
Paul Rivlin analyzes the economic background of China's involvement in the Middle East. Several key questions arise with respect to China’s economic involvement in the Middle East: What are China’s interests in the Middle East? How far are they dominated by its energy needs? How are they affected by its relations with the United States?
Topic:
Foreign Policy, Energy Policy, Foreign Direct Investment, Geopolitics, and Economy
Political Geography:
China and Middle East

5. Nation-Branding: the Case of Russia

Author:
Anna Velikaya
Publication Date:
08-2017
Content Type:
Commentary and Analysis
Institution:
Rethinking Russia
Abstract:
Russia seems to have finally realized in recent years that nation branding, seen as a set of actions to improve country’s image abroad, is a form of investment, not a cost. In order to analyze the Russian approach to nation branding, it is necessary to highlight several dimensions: economic, scientific, cultural, sport, media, and development.
Topic:
Foreign Policy, Foreign Direct Investment, Public Opinion, Economy, Soft Power, and Cultural Diplomacy
Political Geography:
Russia and Eurasia

6. Identifying Foreign Suppliers in U.S. Import Data

Author:
Fariha Kamal and Ryan Monarch
Publication Date:
08-2015
Content Type:
Commentary and Analysis
Institution:
Board of Governors of the Federal Reserve System
Abstract:
Relationships between firms and their foreign suppliers are the foundation of international trade, but data limitations and reliability concerns make studying such relationships challenging. We evaluate and enhance supplier information in U.S. import data and present new facts about importer-exporter relationships. Count of foreign exporters from U.S. import data tends to exceed those from source country data, especially from China. The pattern of U.S. imports from origin countries changes substantially by tracing trade back to the supplier's location instead. Related-party relationships trade more, while larger countries have more relationships.
Topic:
International Cooperation, Foreign Direct Investment, Business, Trade, Data, and Imports
Political Geography:
North America and United States of America