Foreign Direct Investment and Investor-State Dispute Settlement

INTERNATIONAL TRADE LAW 1
International Trade Law
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INTERNATIONAL TRADE LAW 2
International Trade Law
Foreign Direct Investment involves an investment made by a particular company or a
person in one particular nation in a venture in another country. Often foreign direct investment
occurs when a particular investor develops a foreign business enterprise or even makes an
acquisition of assets of foreign business (Nielsen, Asmussen & Weatherall, 2017). Moreover,
FDI entails more than capital investment, and this is because it could also include provisions of
technology as well as management. There are certain key features of foreign direct investment
such as substantial influence over and effective control of decisions to be made in the foreign
business enterprise. The open economies which provide a skilled workforce for the investors
usually provide an environment for foreign direct investment (Anyanwu & Yameogo, 2015).
I do agree with the arguments made in the document of international investment
governance relating to the investment policy framework which allows for foreign direct
investment. According to the document, there are certain vital FDI policies which allow for the
growth of such an investment. The key policies include investment facilitation and promotion,
requirements of performance, ownership restrictions and entry rules, promotion of spillovers and
linkages and incentives (Jones & Wren, 2016). Besides the FDI policies, there are also other
investment related policies which tend to influence the foreign direct investment. Such policies
include labor market regulation, tax policy, trade policy, corporate responsibility, intellectual
property policies, and competition policies among others.
Foreign investment is a significant investment which is preferred by many nations across
the world including individual business owners, and this is because it is a key driver of global
economic growth.T he investor-state dispute settlement has often been used as a tool for the fair
treatment of different investors in the foreign market. Certain benefits come hand in hand with