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82. FDI another day: Russian reliance on European investment
- Author:
- Marta Dominguez-Jimenez and Niclas Poitiers
- Publication Date:
- 02-2020
- Content Type:
- Policy Brief
- Institution:
- Bruegel
- Abstract:
- Most foreign direct investment into Russia originates in the European Union: European investors own between 55 percent and 75 percent of Russian FDI stock. This points to a Russian dependence on European investment, making the EU paramount for Russian medium-term growth. Even if we consider ‘phantom’ FDI that transits through Europe, the EU remains the primary investor in Russia. Most phantom FDI into Russia is believed to originate from Russia itself and thus is by construction not foreign.
- Topic:
- Economics, Energy Policy, Foreign Direct Investment, Governance, Sanctions, European Union, and Global Political Economy
- Political Geography:
- Russia and Europe
83. ECONOMIC REBALANCING AND GEOECONOMIC CHALLENGES FOR CHINA: THE CASE OF INTRA-BRICS TRADE AND FOREIGN DIRECT INVESTMENTS
- Author:
- Marcelo Milan and Leandro Teixeira Santos
- Publication Date:
- 01-2020
- Content Type:
- Journal Article
- Journal:
- Conjuntura Austral: Journal of the Global South
- Institution:
- Conjuntura Austral: Journal of the Global South
- Abstract:
- This article examines the geoeconomic challenges brought to China by the effects of trade and foreign direct investment (FDI) flows, and consequently by the nature and composition of international economic alliances, mainlycooperation among underdeveloped nations(Glosny, 2010), of rebalancing3of its drivers of growth4. It evaluates likely impacts on other BRICS countries, given the economic linkages developed during the past couple of decades, as an example of what may happen to broader geoeconomic arrangements as the process of rebalancing deepens
- Topic:
- International Political Economy, Foreign Direct Investment, Geopolitics, and Economic Cooperation
- Political Geography:
- Russia, China, India, South Africa, and Brazil
84. Quarterly Review of the Georgian Economy (III Quarter, 2019)
- Author:
- Merab Kakulia, Nodar Kapanadze, and Lela Bakhtadze
- Publication Date:
- 01-2020
- Content Type:
- Special Report
- Institution:
- Georgian Foundation for Strategic International Studies -GFSIS
- Abstract:
- The Quarterly Review of the Georgian Economy is an electronic publication of the Georgian Foundation for Strategic and International Studies (Rondeli Foundation), which aims at informing readers about the ongoing processes within the country’s economy. The review is based on data of official statistics and on expert estimates.
- Topic:
- Debt, International Trade and Finance, Foreign Direct Investment, Budget, Employment, Economy, Economic Growth, Banks, and Inflation
- Political Geography:
- Eurasia, Caucasus, and Georgia
85. China and the EU in the Western Balkans: A zero-sum game?
- Author:
- Wouter Zweers, Vladimir Shopov, Frans-Paul van der Putten, Mirela Petkova, and Maarten Lemstra
- Publication Date:
- 08-2020
- Content Type:
- Special Report
- Institution:
- Clingendael Netherlands Institute of International Relations
- Abstract:
- This Clingendael Report explores whether and how China’s approach to the six non-European Union (EU) countries of the Western Balkans (the WB6) relates to EU interests. It focuses in particular on the question of whether China’s influence affects the behaviour of the WB6 governments in ways that run counter to the EU’s objectives in the region. China engages with the Western Balkans primarily as a financier of infrastructure and a source of direct investment. This is in line with China’s main strategic objective for the Western Balkans – that is, to develop the Land–Sea Express Corridor, a component of its Belt and Road Initiative, aimed at improving China–EU connectivity. This report proposes a number of actions based on recognising the developmental needs of countries in the Western Balkans, and accepting that China’s economic involvement is inevitable and potentially beneficial for such developmental needs. In particular, the EU should maximise accession conditionality as a tool to influence the conditions under which China is involved in the region.
- Topic:
- International Relations, Foreign Direct Investment, and European Union
- Political Geography:
- China, Europe, Eastern Europe, and Balkans
86. Cooperation Between the United States and Pakistan: What is the Future?
- Author:
- Riaz A. Khokhar
- Publication Date:
- 01-2020
- Content Type:
- Working Paper
- Institution:
- East-West Center
- Abstract:
- Within the Indo-Pacific region, the United States and Pakistan have sharply divergent strategic objectives. While American objectives have changed over time, focusing in recent years on rivalry with China, Pakistan’s strategic objective has remained constant—to maintain a balance of power with India. Yet Pakistan retains close strategic and economic ties with China, and the United States considers India an important strategic partner. Nevertheless, the two countries have worked together for nearly two decades toward two tactical goals—achieving a political settlement in Afghanistan and eliminating terrorism in South Asia. There is potential for them to cooperate more broadly, for example, increasing direct foreign investment to Pakistan and helping Islamabad balance its relations with the United States and China. Washington’s willingness to expand such cooperation will depend on Pakistan’s cooperation in fighting terrorism in the region.
- Topic:
- International Cooperation, Terrorism, Power Politics, Foreign Direct Investment, and Geopolitics
- Political Geography:
- Pakistan, Afghanistan, China, South Asia, India, North America, United States of America, and Indo-Pacific
87. Assessment of Industrial Cluster Policies in Viet Nam: The Role of Special Economic Zones in Attracting Foreign Direct Investment
- Author:
- Nguyen Quynh Huong
- Publication Date:
- 06-2020
- Content Type:
- Working Paper
- Institution:
- Economic Research Institute for ASEAN and East Asia (ERIA)
- Abstract:
- Special economic zones (SEZs) are considered as one of important regional industrial policies to attract foreign investment in developing countries such as Viet Nam. The review of SEZs development in Viet Nam including the comprehensive review of infrastructure and business environment in SEZs are presented in this paper for the first time. Moreover, the paper gives novel non-parametric evidence to indicate the positive causal linkage between the zoning policies and the attraction of foreign investment at district-level in the country during the period 2011–2015.
- Topic:
- Industrial Policy, Regional Cooperation, Foreign Direct Investment, and Industry
- Political Geography:
- Asia and Vietnam
88. China and geopolitical considerations for investment screening in the Netherlands
- Author:
- Brigitte Dekker, Frans-Paul van der Putten, and Xiaoxue Martin
- Publication Date:
- 12-2020
- Content Type:
- Policy Brief
- Institution:
- Clingendael Netherlands Institute of International Relations
- Abstract:
- This policy brief analyses whether there are grounds for the Dutch government to conduct critical assessments of direct investments, particularly from China, from a geopolitical perspective. The economic consequences of the COVID-19 pandemic warrant continued critical oversight of Chinese foreign investments and screening of such investments. Particularly during the current difficult times for the Dutch economy, there are new opportunities for Chinese investors as a result of increased needs for capital and/or new markets on the part of Dutch companies. This policy brief argues that from a geopolitical perspective there are two grounds for the Dutch government to screen investments: the Netherlands’ need to keep pace with changes in the geopolitical stance of the US and other Western countries towards China; and the risk that the Netherlands and the EU could lose a large part of their capacity for autonomous action in a geopolitical context. Hence there are two criteria that investment screening must fulfill. The first is that it must take account of the security and geopolitical implications of investments in high-tech companies. The second is that it must be aimed at preventing a high degree of strategic dependence on a single operator.
- Topic:
- Foreign Direct Investment, Geopolitics, Economy, Investment, and COVID-19
- Political Geography:
- China and Asia
89. A Search for Independence in President Duterte’s Foreign Policy
- Author:
- Denise Layla P. Miram
- Publication Date:
- 12-2020
- Content Type:
- Special Report
- Institution:
- East-West Center
- Abstract:
- The Duterte administraƟon’s move toward favoring non‐tradiƟonal partners above other equally valuable— and perhaps more beneficial—trade and development partners, such as the United States and the European Union, has significantly changed the direcƟon of the country’s foreign policy and impacted its naƟonal security. While the government maintains that it is pursuing an “independent foreign policy”, many experts have criƟcized the administraƟon’s supposed strategy for its lack of clarity and posiƟon. In the absence of clear guidelines and a well‐defined vision, the administraƟon has merely pivoted away from one superpower, its treaty ally in the US, to global superpowers China and Russia.
- Topic:
- Foreign Policy, Foreign Direct Investment, European Union, Trade, and Rodrigo Duterte
- Political Geography:
- Russia, China, Philippines, Asia-Pacific, and United States of America
90. The Investment Screening Regulation and its screening ground "security or public order": how the WTO law understanding undermines the Regulation's objectives
- Author:
- Jens Velten
- Publication Date:
- 01-2020
- Content Type:
- Working Paper
- Institution:
- Centre for Trade and Economic Integration, The Graduate Institute (IHEID)
- Abstract:
- The EU adopted Regulation 2019/452 (Regulation) as part of a more robust Common commercial policy to strengthen and defend its interests in a shifting global order. More concretely, the Regulation has two objectives: protecting domestic assets from harmful foreign investor interests, and equipping the EU with leverage to achieve more favourable treatment of EU investors abroad. Therefore, the Regulation provides Member States with an option to adopt foreign direct investment (FDI) screening mechanisms on the grounds of “security or public order”. However, the Regulation misses its objectives. The Regulation’s vague screening ground “security or public order” must be interpreted in accordance with WTO law. A detailed analysis finds that the relevant WTO notions of essential security interests and public order are rather narrow. The Regulation’s screening ground “security or public order” therefore only allows the screening of a few, high-profile cases of FDI. Such a narrow scope undermines the Regulation’s objectives.
- Topic:
- International Political Economy, International Trade and Finance, Foreign Direct Investment, and WTO
- Political Geography:
- Europe and European Union
91. Key Drivers of Industrial Growth A Case Study of Botswana’s Manufacturing Sector
- Author:
- Goitseone Khanie
- Publication Date:
- 03-2020
- Content Type:
- Working Paper
- Institution:
- Botswana Institute for Development Policy Analysis
- Abstract:
- The paper examines the key determinants of industrial growth in Botswana, using manufacturing sector value added as the proxy for industrial growth. It employs the Autoregressive Distributed Lag (ARDL) cointegration approach using annual time series data for the period 1983 to 2015. Empirical results show that industrial growth is driven by financial sector development, human capital development, trade openness and foreign direct investment. Specifically, domestic credit to the private sector as a percentage of GDP and secondary school enrolment ratio are found to be significantly related to manufacturing value added as a percentage of GDP both in the long run and short run. While the relationship is limited to long run for total trade to GDP, it only exits in the short run for FDI net inflows. The study therefore recommends that policy makers should design and ensure proper implementation of financial sector development strategies that can help ease access to credit for manufacturing enterprises in the country. There is also a need for a holistic approach in the design and implementation of innovation and human resource development policies in order to provide a conducive environment for skills acquisition, innovation and technological advancements in the manufacturing sector. Trade policies and export promotion strategies should heighten productivity and value addition in the manufacturing sector, so as to make local firms internationally competitive. Finally, with regards to FDI, the Government of Botswana should create an environment that could entice multinationals to invest in the local manufacturing industry. This, however, should be coupled with protectionist policies to avoid crowding out local manufacturers and exposing them to foreign competition.
- Topic:
- Industrial Policy, Foreign Direct Investment, Economic Growth, Manufacturing, and Trade
- Political Geography:
- Africa and Botswana
92. Chinese investment in Uganda: new impetus for sustainable development?
- Publication Date:
- 01-2019
- Content Type:
- Policy Brief
- Institution:
- Advocates Coalition for Development and Environment (ACODE)
- Abstract:
- Chinese investment is flowing fast into Uganda, and spreading into the agriculture and forestry sectors. The government needs to keep pace with these developments so the benefits can be shared by Ugandans. A new analysis shows that, while the jobs and new businesses created are well received, the working conditions and environmental practices of Chinese companies are often poor. Many people evicted from their land to make way for new projects have not been compensated. To hold Chinese companies to account, government agencies, with support from NGOs, must share information about these investments and introduce stronger regulation — in particular to uphold community rights. In turn, Chinese companies must be more transparent, responsible and legally compliant. With a proactive and accountable strategy for Chinese investment management, Uganda could make major gains for sustainable development.
- Topic:
- Development, Economics, International Trade and Finance, Foreign Direct Investment, Business, Accountability, Investment, and NGOs
- Political Geography:
- Uganda, Africa, and China
93. The Linkage between Foreign Direct Investment and Intra-Regional Trade within ECOWAS
- Author:
- Eme Dada
- Publication Date:
- 08-2019
- Content Type:
- Policy Brief
- Institution:
- African Economic Research Consortium (AERC)
- Abstract:
- The objective of this policy brief is to inform the Ministers of Trade and Investment of Economic Community of West African State (ECOWAS) countries about the importance of the linkage between Foreign Direct Investment (FDI) and trade for developing countries. FDI is considered an important means of promoting export of the host countries. This is true of inward FDI, which comes for efficiency reasons. Conversely, there is concern that large flows of outward FDI results in a decline in the host country’s exports and loss of jobs. This in turn assumes that the exports of the source country will fall as FDI substitutes for trade.
- Topic:
- Development, Economics, International Trade and Finance, Foreign Direct Investment, and Economic Growth
- Political Geography:
- Africa, Liberia, Sierra Leone, Senegal, Mali, Guinea, Guinea-Bissau, Cape Verde, and Gambia
94. China’s Recent Engagement in Latin America and the Caribbean: Current Conditions and Challenges
- Author:
- Enrique Dussel Peters
- Publication Date:
- 06-2019
- Content Type:
- Working Paper
- Institution:
- The Carter Center
- Abstract:
- Since the beginning of the 21st century, China’s presence in Latin America and the Caribbean (LAC) has been substantial in practically all socio-economic fields: cultural, bilateral and multilateral political issues, as well as trade, foreign direct investments, academic exchanges, and other areas. The main objective of this document is to analyze the effects of China’s presence in the region in terms of sustainable and long-term development, as well as its incidence in its relationship with the United States. Thus, the document will include a diagnostic to understand some of the specificities of the LAC-China socio-economic relationship, followed by the conclusion with a series of proposals. The first section of the paper will examine five issues that are relevant to understand general and specific topics about the China-LAC relationship: 1) general geostrategic and diplomatic topics to understand current tensions between the United States and China; 2) China’s proposal of a globalization process; 3) the concept of “new triangular relationships” and LAC’s challenges given increasing tensions between the United States and China; 4) particular developments and structures in trade, foreign direct investment, financing and infrastructure; and 5) the institutional framework between LAC and China. The second part of the paper focuses on a series of recommendations attempting to deepen and extend the China-LAC relationship and integrating the United States in it.
- Topic:
- International Cooperation, Bilateral Relations, Foreign Direct Investment, Culture, and Multilateral Relations
- Political Geography:
- China, Asia, Latin America, North America, and United States of America
95. Does Participation in Global Value Chains Increase Productivity? An Analysis of Trade in Value Added Data
- Author:
- Shujiro Urata and Youngmin Baek
- Publication Date:
- 11-2019
- Content Type:
- Working Paper
- Institution:
- Economic Research Institute for ASEAN and East Asia (ERIA)
- Abstract:
- This paper examines the impact of global value chain (GVC) participation on productivity by considering both backward and forward participation. Conducting a panel estimation covering 47 countries and 13 manufacturing sectors for 1995–2011, we found that both backward and forward GVC participation contributes to an increase in the productivity of the countries involved in GVCs. In particular, benefits in the form of improved productivity are larger in cases where developing countries procure intermediate goods from developed countries, or backward participation. Our analysis indicates the importance of GVC participation for improving productivity. We argue that, in order for a country to increase GVC participation, an open, free, and transparent trade and foreign direct investment environment (which is provided by regional trade agreements); well-developed soft infrastructure (e.g. educational and legal systems); hard infrastructure (e.g. transportation and communication systems); and the availability of capable human resources are important.
- Topic:
- International Trade and Finance, Foreign Direct Investment, and Global Value Chains
- Political Geography:
- Global Focus
96. How Does Protectionist Trade Policy Interact with FDI?
- Author:
- Jongduk Kim and Moonhee Cho
- Publication Date:
- 12-2019
- Content Type:
- Working Paper
- Institution:
- Korea Institute for International Economic Policy (KIEP)
- Abstract:
- In this study, we investigate the question whether importing countries’ implementation of protective trade measures, such as antidumping duties, leads to changes in foreign direct investment from trading partners. That is, we examine the prevalence of “ADP-jumping FDI” across countries. We use more recent and organized non-tariff measure data provided by the WTO I-TIP and Ghodsi et al. (2017), which can be matched with other trade-related variables. Using econometrically sensible identification strategies, the Tobit and the Heckman two-stage selection models, we find out that ADP-jumping FDI to importing countries prevails rather consistently around the world. These results are also consistent with those using Poisson and linear fixed effects models.
- Topic:
- Foreign Direct Investment, Trade, and Protectionism
- Political Geography:
- Asia, Korea, and Global Focus
97. Implications of Foreign Direct Investment, Capital Formation and its Structure for Global Value Chains
- Author:
- Amat Adarov and Robert Stehrer
- Publication Date:
- 11-2019
- Content Type:
- Working Paper
- Institution:
- The Vienna Institute for International Economic Studies (WIIW)
- Abstract:
- In the age of globalisation, international trade and foreign direct investment (FDI) have become integral elements of cross-country production sharing. In this paper we empirically assess the impact of FDI, as well as capital dynamics and structure, on the formation of global value chains (GVC) and trade in value added at country and sectoral levels based on a database constructed for a sample of European countries over the period 2000-2014. The analysis reveals that inward FDI is especially conducive to the formation of backward linkages while outward FDI facilitates forward GVC participation, especially in high-tech manufacturing sectors. A particularly robust influence of FDI and capital accumulation on GVC integration is identified in the textile and clothing industry. While capital accumulation in general intensifies GVC linkages for most sectors, ICT capital appears to be especially instrumental for backward integration of electrical and transportation equipment sectors.
- Topic:
- Globalization, International Trade and Finance, Foreign Direct Investment, Trade, and Global Value Chains
- Political Geography:
- United States, Japan, and Europe
98. 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
99. Competing with Whom? European Tax Competition, the “Great Fragmentation of the Firm,” and Varieties of FDI Attraction Profiles
- Author:
- Javier Garcia-Bernardo and Arjan Reurink
- Publication Date:
- 10-2019
- Content Type:
- Working Paper
- Institution:
- Max Planck Institute for the Study of Societies
- Abstract:
- International tax competition is generally framed as states competing for foreign direct invest- ment (FDI), and analyses of the phenomenon draw heavily on FDI statistics. In and of themselves, however, FDI statistics are merely a quantification of the value of investment projects and tell us little about the heterogeneity of these projects and the distinct patterns of competitive dynamics between countries they generate. In this paper, we create a more sophisticated understanding of international tax competition by pointing out its variegated nature. To do so, we introduce the notion of the “great fragmentation of the firm” to distinguish between five categories of FDI: manufacturing affiliates, shared service centers, research and development facilities, intermedi- ate holding companies, and top holding companies. Using a novel combination of firm-level and country-level data, we identify for each category of FDI which European Union member states are most successful in attracting it, what macro-institutional and tax arrangements they rely on for doing so, and what benefits they receive from it in terms of tax revenues and employment creation. In this way we were able to identify five distinct FDI attraction profiles and show that, rather than being a game of all against all, tax competition in the European Union increasingly takes place amongst subsets of countries that compete for similar categories of FDI.
- Topic:
- Foreign Direct Investment, European Union, and Tax Systems
- Political Geography:
- Europe
100. Quarterly Review of the Georgian Economy ( III Quarter, 2018)
- Author:
- Merab Kakulia, Nodar Kapanadze, and Lela Bakhtadze
- Publication Date:
- 01-2019
- Content Type:
- Special Report
- Institution:
- Georgian Foundation for Strategic International Studies -GFSIS
- Abstract:
- The Quarterly Review of the Georgian Economy is an electronic publication of the Georgian Foundation for Strategic and International Studies (Rondeli Foundation), which aims at informing readers about the ongoing processes within the country’s economy. The review is based on data of official statistics and on expert estimates.
- Topic:
- Debt, International Trade and Finance, Foreign Direct Investment, Budget, Employment, Economic Growth, Banks, and Inflation
- Political Geography:
- Eurasia, Caucasus, and Georgia