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161. Political risk insurance and bilateral investment treaties: a view from below

Author:
Lauge Skovgaard Poulsen
Publication Date:
08-2010
Content Type:
Policy Brief
Institution:
Columbia Center on Sustainable Investment
Abstract:
Many of the risks covered by bilateral investment treaties (BITs) are also covered by political risk insurance (PRI). Although there are important differences between PRI and BITs, both in terms of coverage and underlying purpose, the considerable overlap between the two instruments suggest that PRI providers should take BITs into account when assessing the risk of investment projects. But while the relationship between BITs and PRI has often been alleged to be considerable, in practice there is practically no publicly available evidence to sustain this assumption. This Perspective reviews evidence from a recent survey of officials in private and public (or mixed private/public) PRI providers.
Topic:
Economics, International Political Economy, International Trade and Finance, Treaties and Agreements, and Bilateral Relations

162. FDI incentives pay — politically

Author:
Nathan M. Jensen and Edmund J. Malesky
Publication Date:
06-2010
Content Type:
Policy Brief
Institution:
Columbia Center on Sustainable Investment
Abstract:
Despite broad skepticism about the benefits of globalization, the majority of U.S. states have offered lucrative tax incentives to attract investment. The size of these incentives is generally considered too large to be welfare enhancing, and many economists are skeptical of the effectiveness of these policies. Yet despite the mounting evidence to the contrary, the incentives offered by U.S. states (and foreign countries) continue and have actually increased in their generosity over time.
Topic:
Economics, Political Economy, Politics, and Foreign Direct Investment
Political Geography:
United States

163. The response to the global crisis and investment protection: evidence

Author:
Kathryn Gordon and Joachim Pohl
Publication Date:
06-2010
Content Type:
Policy Brief
Institution:
Columbia Center on Sustainable Investment
Abstract:
In March 2009, Columbia FDI Perspectives carried an early analysis of investment policies in response to the financial crisis that began in early 2008. At that time, the authors, Anne van Aaken and Jürgen Kuntz, found “clear evidence of widespread discrimination directed at foreign actors” in the emergency response to the crisis.
Topic:
Economics, Global Recession, Monetary Policy, Foreign Direct Investment, and Financial Crisis
Political Geography:
Colombia

164. Foreign direct investment and U.S. national security: CFIUS under the Obama Administration

Author:
Mark E. Plotkin and David N. Fagan
Publication Date:
06-2010
Content Type:
Policy Brief
Institution:
Columbia Center on Sustainable Investment
Abstract:
There was considerable public scrutiny of the Obama Administration's performance in its inaugural year, but comparatively little focus on one of the Administration's key processes governing the flow of investment into the United States — namely, the Committee on Foreign Investment in the United States (CFIUS). Yet, this is a frequent question we receive from foreign investors -- has the change in the administration affected CFIUS?
Topic:
Economics, International Trade and Finance, Monetary Policy, Foreign Direct Investment, and Financial Crisis
Political Geography:
United States

165. Thinking twice about a gold rush: Pacific Rim v El Salvador

Author:
Gus Van Harten
Publication Date:
05-2010
Content Type:
Policy Brief
Institution:
Columbia Center on Sustainable Investment
Abstract:
Whether it concerns oil drilling or gold mining, sometimes a government, facing new circumstances, must change its mind.
Topic:
Economics, International Trade and Finance, and Foreign Direct Investment
Political Geography:
Latin America

166. How BRIC MNEs deal with international political risk

Author:
Premila Nazareth Satyanand
Publication Date:
05-2010
Content Type:
Policy Brief
Institution:
Columbia Center on Sustainable Investment
Abstract:
Hitherto, political risk has worried developed country multinational enterprises (MNEs) investing in developing country markets. But as more emerging market firms invest overseas, they too must grapple with this subject. World Investment and Political Risk 2009 looks at this issue for the first time and finds that Brazilian, Russian, Indian, and Chinese (BRIC) firms appear to worry more about political risk than global counterparts. Though these results are based on as mall sample of 90 of the largest BRIC investors, they are thought-provoking nonetheless.
Topic:
International Political Economy, International Trade and Finance, and Foreign Direct Investment
Political Geography:
Russia, China, India, and Latin America

167. Inward FDI in Colombia and its policy context

Author:
Miguel Posada Betancourt
Publication Date:
09-2010
Content Type:
Working Paper
Institution:
Columbia Center on Sustainable Investment
Abstract:
Colombia used to be a synonym for violence and drugs, but not anymore. Today, the country has one of the best performing economies in Latin America, and violence levels have been dramatically reduced. The outgoing administration made improving investor confidence and the business environment one of the pillars of its policy. As a result of important reforms and aggressive campaigns to promote the country as an attractive location, inward foreign direct investment (IFDI) has risen to unprecedented levels. Due to these positive changes, Colombia has been designated a “top reformer” for the past four years in the World Bank's Doing Business reports, and the new Government has promised to maintain and reinforce efforts to attract foreign investment. Even though IFDI flows decreased in the past two years as a consequence of the economic and financial crisis, many foreign affiliates in Colombia achieved positive profits. A country that a decade ago was avoided is now in many investors' plans.
Topic:
Development, Economics, War on Drugs, and Foreign Direct Investment
Political Geography:
Colombia and Latin America

168. Inward FDI in Peru and its policy context

Author:
Benjamin Chavez and Jaime Dupuy
Publication Date:
08-2010
Content Type:
Working Paper
Institution:
Columbia Center on Sustainable Investment
Abstract:
Peru has shifted from being a small FDI player in the Latin America and Caribbean region in the 1990s to being the sixth largest FDI host country in 2008. With inflows of US$ 6.9 and US$ 4.8 billions in 2008 and 2009, respectively, Peru has managed to contain the impact of the financial crisis on inward FDI (IFDI). The main determinants of the improved FDI performance were: a stable economic and FDI policy since 1992;) vast natural resources; strong gross domestic product (GDP) and market growth; and an export-oriented economy, especially during the past decade. In recent years, Peru has become one of the fastest growing economies in Latin America and a diversified commercial hub for IFDI in the region.
Topic:
Economics, Monetary Policy, and Foreign Direct Investment
Political Geography:
Latin America, Caribbean, and Peru

169. The pernicious institution of the party-appointed arbitrator

Author:
Hans Smit
Publication Date:
12-2010
Content Type:
Policy Brief
Institution:
Columbia Center on Sustainable Investment
Abstract:
As arbitration has grown by leaps and bounds, so has the role of the party-appointed arbitrator. Surprisingly, this has not led to increased inquiry into the appropriateness of having arbitrators appointed by the parties in general, or in arbitrations against states in particular. In my judgment, party-appointed arbitrators should be banned unless their role as advocates for the party that appointed them is fully disclosed and accepted. Until this is done, arbitration can never meet its aspiration of providing dispassionate adjudication by those with special skills and experience in a process designed to combine efficiency with expertise.
Topic:
Development, Politics, Foreign Direct Investment, and Law
Political Geography:
Colombia

170. State-controlled entities as claimants in international investment arbitration: an early assessment

Author:
Michael D. Nolan and Frédéric Sourgens
Publication Date:
12-2010
Content Type:
Policy Brief
Institution:
Columbia Center on Sustainable Investment
Abstract:
State-controlled entities (SCEs) are increasingly important participants in international investment flows and international trade. Cumulative FDI by sovereign wealth funds (SWFs) has reportedly reached US$100 billion. SWFs are significant equity investors in, and provide significant debt financing to, every kind of company, from professional sports franchises to container ports. In addition to the role of these funds, national oil companies are growing in regional and international importance. In many countries, other industries are also increasingly government-owned.
Topic:
Development, Government, Industrial Policy, International Trade and Finance, Political Economy, and Foreign Direct Investment
Political Geography:
United States