How do governments balance the need for foreign investment with the protection of national security interests?
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Governments navigate a delicate balance between fostering foreign investment and safeguarding national security interests. The interplay involves considerations of economic resilience, security, and innovation in a globalized landscape . During crises, like the COVID-19 pandemic, emergency measures may disrupt international commitments, prompting a reevaluation of the international economic ecosystem . National security interests influence outbound foreign direct investment (FDI) through policy tools like military aid and political risk insurance, impacting US FDI outflows to developing countries . The challenge lies in reconciling the host country's national security with the legitimate expectations of foreign investments within the framework of international investment laws, which often lack clarity and balance . Balancing these interests requires nuanced approaches to attract investments while ensuring protection and sovereignty.
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| Papers (5) | Insight |
|---|---|
| Governments struggle to balance national security and foreign investment expectations due to unclear international laws, risking sovereignty or neglecting investor rights, creating a challenging regulatory environment. | |
02 Nov 2022 | Governments balance foreign investment and national security by influencing outbound FDI through military aid and political risk insurance, as studied in US FDI outflows to developing countries. |
| Governments balance foreign investment and national security by providing legal protection to foreign investors during economic crises, ensuring investment attractiveness while safeguarding national interests. | |
| Governments balance foreign investment and national security by enacting emergency measures post-pandemic, supporting domestic businesses, and reforming international investment agreements to enhance sovereign action. | |
01 Jan 2023 | Governments balance foreign investment and national security by navigating the weaponization of investments, evaluating global competition's impact on technology, economy, and security, and making strategic decisions accordingly. |
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