Sauvant, Karl P.
Description:
Over the past two decades or so,
countries have liberalized their FDI regulatory frameworks
and have put in place an international investment law regime
that provides various protections for international
investors. In the past few years, however, there are signs
that countries are reevaluating their approach toward such
investment. As a result, FDI protectionism is on the rise,
with screening of inward M&As becoming more frequent.
Typically, this is being done under the guise of
"national interest" or similar concepts, often
linked to strategic sectors and national champions. While
the international investment law regime faces a challenge to
find the right balance between the rights and
responsibilities of governments and investors, care needs to
be taken that the rise of FDI protectionism does not
endanger a rules-based approach to FDI. An independent FDI
Protectionism Observatory to monitor new protectionist
measures and name and shame countries that take them is
therefore needed.