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Advanced Introduction to International Trade Law

Michael J. Trebilcock Joel Trachtman

Written by two leading scholars with 60 years of collective experience in the area, this insightful updated second edition provides a clear and concise introduction to the fundamental components of international trade law, presenting the basic structure and principles of this complex area of law, alongside elucidation of specific GATT and WTO legal rules and institutions. Key updates include references to the most recent cases, decisions and treaty negotiation developments, analysis of populist critiques of international trade law and analysis of new areas including digital trade and security exceptions.
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Trade and investment

Michael J. Trebilcock Joel Trachtman

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Foreign direct investment (FDI) (which is the focus of this chapter) should be distinguished from portfolio investment. FDI typically involves some form of effective control and active management of assets in host countries, while portfolio investment typically involves passive investments in enterprises or government bonds in host countries. Over the last several decades, there has been a dramatic increase in FDI around the world, much of it between developed countries, but increasingly developing countries have been major recipients of FDI, including countries such as China, and in some cases have themselves become exporters of FDI (again, China is a prominent example).1 In 2018, the share of FDI to developing countries reached a record 66 per cent.2 FDI flows to developing countries now exceed foreign aid flows by a factor of about five to one.3

In their early post-independence years, many former colonies viewed FDI with skepticism, and in some cases outright hostility, as it was perceived to be a new form of economic imperialism (reflected in dependency theories of development that were influential in many developing countries in the 1950s and 1960s). More recently, many developing countries have come to see FDI as having at least the potential for making significant contributions to their economies – as a source of investment in infrastructure, as a source of technology transfers and spillovers, as a source of investment in human capital and skills upgrading, as a source of investment in major natural resource extraction projects, and as a major source...

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