anatomy of investment agreements of the european union
DESCRIPTION
At the end of 2013, the European Union and China announced the start of negotiations on a bilateral investment agreement. This will be the first agreement signed by the European Union as a partner, and not by its Member States. However, almost all Member States of the European Union have already signed, this type of agreement with China. This raises the question of the added value of new contracts entered into by the European Union. Is the new agreement is able to attract new investors? The aim of this study is to demonstrate how agreements concluded by the EU countries have influenced the volume of stock of foreign direct investment. This paper proposes an analysis of BIT and FTA&EIA agreements and then conducted an empirical study based on FDI stocks of the European Union countries.TRANSCRIPT
ANATOMY OF INVESTMENT AGREEMENTS OF THE EUROPEAN UNION AND ITS MEMBER STATES
Magdalena Słok-WódkowskaFaculty of Law and Adminitration UW
Katarzyna ŚledziewskaFaculty of Economics Sciences UW
Introduction
• The aim of this study– to demonstrate how agreements concluded by the
EU countries have influenced the volume of stock of FDI.
1. An analysis of BIT and FTA&EIA agreements 2. An empirical study based on FDI stocks of the
European Union countries
Bilateral Trade Agreements (BIT)
• Concluded usually with two parties only– protection and promotion of foreign investements
• Broad definition on investments – all assets that are owned or controlled by an
investor directly or indirectly• Traditionally between developing countries
with developed– trend has changed recently
Free Trade Agreements & Economic Integration Agreements (FTA&EIA)
• Bilateral, multirateral, between groups of coutries
• Preferential trade liberalisation of trade in goods (FTA/CU) and services (EIA)
BIT
• Aim: protection of investments, mainly against expropretion
• Outside the scope of the WTO law
• Usually bilateral
• Traditionally concluded between parties whose mutual trust is limited
FTA&EIA
• Aim: liberalization of investing in partner territory,
• Regulated by the WTO, permitted by the Article V GATS
• Both multilateral and bilateral
• Requires mutual trust and cooperation between parties
EU BITs and RTAsBIT
• Concluded individually by EU MS (EU can since XII 2009)
• Since 1959 MS concluded 1326 BITs with non-EU parties
• Germany 120 BITs, • UK, France, Italy, Belgium, Netherlands
and Spain between 91 and 73, – majority of them with developing
countries
• CEE with developed partners (US, Canada, Japan)
• China and Turkey have BITs with all EU MS – except Ireland
RTA
• Concluded by the EEC/EC/EU
• 32 FTA, CU & EIA notified to the WTO
Number in BITs concluded by EU Member States, 1960-2012
19601963
19661969
19721975
19781981
19841987
19901993
19961999
20022005
20082011
0
10
20
30
40
50
60
70
80
90
100
?
• Is there any impact of BITs or EIAs on FDI outward stock?
• 4 groups of countries– BIT– FTA&EIA– EU– ROW
• Data: bilateral, MS EU FDI stock, abroad, Eurostat
EU’s FDI (outward stocks) in different country groups, in bln EUR
20002001
20022003
20042005
20062007
20082009
20102011
2012 -
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
UEROWBITFTA&EIA
Dynamics of growth of the EU’s outward FDI stocks, 2000 = 100
20002001
20022003
20042005
20062007
20082009
20102011
2012 -
100
200
300
400
500
600
UEROWBITFTA&EIA
Share in total EU FDI outward stock, in%, 2000-2012
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 -
5.00
10.00
15.00
20.00
25.00
30.00
BITFTA&EIA
Changes in significats of different coutry coup in EU FDI outward stock
ROW BIT FTA&EIA
(10.00)
-
10.00
20.00
30.00
40.00
50.00
20122012/00
The impact of BITs and RTAs on FDI
• Small but increasing– No FTA&EIA agreements with main partners
(United States, Brazil , Canada , Bermuda, Russia)– BITs yes (USA , Canada) but it’s recent
• What about the impact?