China’s Investment Strategies: Where to Post Pandemic?

Abstract

China’s once geometrically expanding investment treaty regime is increasingly beset by unstable investment markets, politicized trade sanctions, and conflicting domestic demands on its financial reserves. A dilemma facing China is how to manage its relationships collaboratively with its treaty partners. At stake are treaties concluded by competitors like the EU with both developed and developing states that provide access to foreign markets previously serviced largely by China and its outbound investors.

This article scrutinizes China’s likely responses to these formidable obstacles. One reaction is for China to selectively extend the policies underlying its planned domestic economy to global investment markets. In doing so, China risks being typecast as an investment overlord that turns developing states into dependencies rather than fully participating investment partners. A reconciliatory approach is for China to champion profitable dealings with shared benefits for its bilateral treaty partners and their investors. To redress these obstacles effectively is a key challenge for China. This Article explores that challenge in assessing how China is likely to protect both its national interests and the interests of foreign investors, consistently with its planned economy and the liberalization investment law.