Chinese Outward Foreign Direct Investment to the Central and Eastern European Countries in the Pandemic and Post-Pandemic World

The COVID-19 pandemic, an unexpected event with strong and long-lasting consequences, led to increased uncertainty among investors and collapses in commodities and financial markets. However, while some investors pulled their capital out and sold assets, others bought them back at low prices. Although less volatile, the foreign direct investment (FDI) market was also hit hard. Against this background, this paper explores the effect of the pandemic on Chinese FDI in Central and Eastern European (CEE) countries that are strategically important to China. The paper uses the Coordinated Direct Investment Survey by the International Monetary Fund (IMF), the Statistical Bulletins of China’s Outward Foreign Direct Investment, the OECD.Stat FDI data, and the China Global Investment Tracker. The paper finds that the pandemic did not have a negative impact on Chinese outward FDI to the CEE countries. The structure of Chinese outward FDI to the CEE countries changed in favor of more indirect FDI. Moreover, the paper shows that there are still huge discrepancies between the IMF data and the Chinese national statistics, which suggests that further work in the direction of statistical harmonization is necessary. As for the future of Chinese investment in the region, the paper anticipates China’s continued strategic interest in the region with increasing competition from other geopolitical centers

Chinese outward foreign direct investment to the Central and Eastern European countries in the pandemic and post-pandemic world

The COVID-19 pandemic, an unexpected event with strong and long-lasting consequences, led to increased uncertainty among investors and collapses in commodities and financial markets. However, while some investors pulled their capital out and sold assets, others bought them back at low prices. Although less volatile, the foreign direct investment (FDI) market was also hit hard. Against this background, this paper explores the effect of the pandemic on Chinese FDI in Central and Eastern European (CEE) countries that are strategically important to China. The paper uses the Coordinated Direct Investment Survey by the International Monetary Fund (IMF), the Statistical Bulletins of China’s Outward Foreign Direct Investment, the OECD.Stat FDI data, and the China Global Investment Tracker. The paper finds that the pandemic did not have a negative impact on Chinese outward FDI to the CEE countries. The structure of Chinese outward FDI to the CEE countries changed in favor of more indirect FDI. Moreover, the paper shows that there are still huge discrepancies between the IMF data and the Chinese national statistics, which suggests that further work in the direction of statistical harmonization is necessary. As for the future of Chinese investment in the region, the paper anticipates China’s continued strategic interest in the region with increasing competition from other geopolitical centers

Predicting tax treaty formation using machine learning: Implications for parliamentary practice

This study delves into the predictive potential of machine learning algorithms for tax treaty formations between countries, addressing a critical gap in international economic relations. Our research question investigates the capability of machine learning to accurately predict future tax treaty engagements based on economic determinants. We utilized a comprehensive dataset comprising variables such as foreign direct investment, trade volumes, GDP, and geographical distance, applying various classification algorithms, with the random forest algorithm demonstrating superior accuracy. Our methodology included training the model on 2018 data and validating it with 2019 data, successfully identifying 59 country pairs likely to engage in tax treaties. The findings indicate that economic factors coupled with machine learning provide a robust framework for predicting tax treaty formations, which traditional econometric methods fail to match in predictive power. This research innovates by integrating advanced machine learning techniques into the domain of international economic policy, significantly enhancing predictive accuracy and decision making efficiency. The potential relevance of this research to parliamentary practice is profound, particularly in understanding how new technologies like machine learning can enhance the capacities of parliaments. By equipping policymakers with predictive insights about tax treaty formations, this study aids in better resource allocation and strategic planning in international relations and economic policies. Furthermore, it prompts legislative bodies to consider regulatory frameworks that incorporate technological advancements to improve governance and policy effectiveness in global economic interactions. This research thus not only contributes to academic literature but also serves as a vital tool for legislative and economic strategists, enhancing the proactive capabilities of parliaments in a digitally evolving landscape

The impact of unilateral tax treaty terminations on FDI

This study analyses the effect of unilateral tax treaty terminations on FDI. It identifies two major patterns—developing countries terminating tax treaties with developed countries for the reasons of tax revenue losses and developed countries terminating treaties with other developed countries for the reasons of non-taxation of pensioners. The study focuses on the effects of terminations for developing countries. To assess the effects of terminations on FDI, a theoretical model is developed incorporating factors such as the rate of return on FDI, exit and entry costs, termination-induced distortion and the probability of concluding new treaties. This contributes to our understanding of the impact of tax treaty terminations on FDI and may have significant implications for policymaking and investment strategies

Greater Europe From Lisbon to Vladivostok: Challenges and perspectives of a Common Economic Space

This paper aims to review the history of the idea of a free trade area from Lisbon to Vladivostok, or more specifically the creation of a free trade area between the European Union and the Eurasian Economic Union (or Russia in earlier versions of this idea). The present state of trade and investment relations between Russia and the European Union is examined. An extensive literature review is provided on the benefits of establishing a free trade area between the European Union and Russia (or the Eurasian Economic Union). Concrete steps for the potential strengthening of cooperation between the Unions are outlined. The barriers to integration are discussed in detail, as well as the challenges within the Eurasian Economic Union. It is shown that a dialogue between the European Union and the Eurasian Economic Union will allow them to restore and expand economic cooperation and take another step towards the realization of the concept of a common economic space from Lisbon to Vladivostok, beneficial to all parties involved

Artic shipping needs anti-avoidance rules to mitigate environmental disasters

Global warming will accelerate the melting of ice and release some of the Arctic territories for shipping. On the one hand, it will have a positive impact on world trade but on the other hand, the risk of ship accidents and environmental disasters will increase. In the period from 2010 to 2019, 512 ship accidents in Arctic Circle Waters were reported, not without damage to the environment. However, today's legal structure of the shipping industry makes it virtually impossible to make the ultimate owners of ships liable and responsible for environmental costs. There is no international regulation that would pressure the shipping industry to increase its corporate responsibility and to make more sustainable decisions of using clean fuels, improving the environmental friendliness of ships, or recycling old ships. Recommendation 1. To improve availability and transparency of ultimate beneficial ownership data in the shipping industry. Recommendation 2. To develop mechanisms to hold the ship's ultimate beneficial owners liable for maritime incidents such as oil spills. Recommendation 3. To design anti-avoidance rules applicable to the use of flags of convenience and last-voyage flags (in the spirit of anti-tax avoidance rules)