[International bilateral relations]

by

Acknowledgement

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DECLARATION

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Abstract

The aim of this paper was to analyze the international bilateral relations. Foreign investors are often skeptical toward the quality of the domestic institutions and the enforceability of the law in developing countries. Bilateral investment treaties (BITs) guarantee certain standards of treatment that can be enforced via binding investor-to-state dispute settlement outside the domestic juridical system. Developing countries accept restrictions on their sovereignty in the hope that the protection from political and other risks leads to an increase in foreign direct investment (FDI), which is also the stated purpose of BITs. We provide the first rigorous quantitative evidence that a higher number of BITs raises the FDI that flows to a developing country. This result is very robust to changes in model specification, estimation technique, and sample size. There is also some limited evidence that BITs might function as substitutes for good domestic institutional quality, but this result is not robust to different specifications of institutional quality.Table of Content

ABSTRACT4

CHAPTER I7

Introduction7

CHAPTER II18

Literature Review18

Three issues guiding discussions20

The EU regime: replicating a model of convergence26

Abortive attempts at establishing international rules 1945-present32

Current initiatives36

The prognosis for an international competition regime38

Bilateral agreements42

Building new institutional arrangements for the new millennium48

Economic Linkages Between China And Japan52

The stylized facts of Japanese direct investment and trade in China56

Conceptual framework of the effects of FDI on the bilateral trade59

Trade structure: China and Japan63

CHAPTER III68

Methodology68

The nature of international co-operation68

Types of agreements73

Bilateral agreements73

Multinational agreements74

Multilateral-global agreements81

CHAPTER IV86

Analysis and Discussion86

Existing international trade union links88

Global Trade Union Federations88

Bilateral links89

Cross-border mergers90

Shipping91

The Unite the Union/United Steelworkers92

Foreign direct investment and bilateral investment treaties: An international political perspective94

Foreign direct investment and interstate political relations97

Foreign direct investment and bilateral investment treaties99

Bilateral versus multilateral agreements102

Effect of the BITs on investment104

BITs and governance: Why international alternatives may not help108

CHAPTER V126

Conclusion126

REFERENCES129

Chapter I

Introduction

As globalization becomes increasingly more evident as countries become further integrated with one another, trade agreements have been formed in recent years to ensure trade opportunities can be gained from. These agreements and trading alliances can be large-scaled such as the global agreement World Trade Organisation (WTO), the smaller scale regional agreements such as the European Union (EU) as well as agreements between two specific countries such as CERTA - Closer Economic Relations Trade Agreement between Australia and New Zealand. They all have the aim of reducing barriers to trade between countries, a process described as trade liberalization.

Trading blocs aid the process of trade liberalization in that it promotes free trade between countries - examples of such groups are the Asia-Pacific Economic Co-operation (APEC) and European Union (EU). Although their arrangements may result in the ...