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Better protection for foreign investment on a national level

An in-depth look at bilateral investment treaties (BITs) between nations can help reach better agreements in the future, safeguarding investments and supporting economies.
Better protection for foreign investment on a national level
Over the last few decades, international trade and investment has flourished, thanks to some 3 000 BITs that world governments have signed. Protecting foreign investors and regulating foreign direct investment, these agreements play a key role in economic development, global inequality, national sovereignty and international obligations.

Since the 1990s, and in view of what these agreements needed to achieve, many were renegotiated, particularly with the aim of solidifying international obligations. The EU-funded BITRENEGOTIATION (The renegotiation of international agreements: The case of bilateral investment treaties) project examined why some agreements have been renegotiated while others have remained intact. It aimed to understand why governments revise treaties and to what extent they could raise foreign capital to further their economic, social and political objectives.

To achieve its aims, the project developed a framework in order to explain the renegotiation of international treaties, looking particularly at investor-state dispute settlement (ISDS). It measured how much the treaties extend greater investor protection or greater regulatory space for the state. This revealed major differences in the provisions that governments choose to revise treaties and the way they do so, looking as well at if and how such changes respond to governments' experiences with the global investment regime.

By accurately assessing the implications of BIT renegotiation, the project's results reveal how governments respond to the challenges emerging from the global investment regime and the conditions under which they do so. This provides valuable support to policymakers who seek new investment agreements and could bear on ISDS provisions in the context of the new Transatlantic Trade and Investment Partnership. Better international treaties and agreements could ultimately emerge from the results of this project, reducing conflict among nations and helping to support their economies.

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Foreign investment, bilateral investment treaties, trade and investment, economic development, ISDS
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