Project Manager
Henrik HornProject manager
Institute for Business ResearchAmount granted
491 500 SEKYear
2023
A significant share of global investment is covered by intergovernmental investment protection agreements. The agreements have been criticized on a number of points. Among other things, it is argued that the agreements slow down the phasing out of fossil fuel production systems.
The changing geopolitical situation in recent years has added a new dimension to these agreements by emphasizing protection against, rather than protection of, inward international investment. One example is the EU's pursuit of 'strategic autonomy' and increasingly far-reaching demands that foreign investment not be allowed in sensitive sectors. The dispute between Huawei and Sweden over the exclusion from the 5G auction, which is being conducted under the China-Sweden agreement, illustrates the security policy aspects of these agreements.
This sub-project will shed light on exclusion clauses for security policy measures in investment protection agreements. Although national security and climate concerns are politically separate issues, both types of concerns affect the value of agreements in a similar way. Both can be seen as exogenous shocks that reduce host countries' gains from the agreements, and escape clauses can be seen as ways to allocate risk. Nevertheless, from an economic point of view, are there reasons to design national security escape clauses differently from corresponding clauses for climate action? How well does the existence of such clauses correlate with security tensions between countries?