International Economic Governance Research Articles

Le droit international néolibéral : les contributions du contenu et des sources du DI au néocolonialisme

The end of the Second World War and the establishment of the UN have provoked new changes as regards international relations. Not only has decolonization became one of the most fundamental rhetorical objectives of international society, but also entrenched changes towards the composition of this society (a majority of underdeveloped countries in the UN system). As a consequence, it seemed that international society and international law would propitiate a new era of mutual development. Nonetheless, new discords have erupted in international society, mainly as concerns the economic realm. The main objective of this article is the demonstration of the continued use of international law (its content and sources) as a legitimizing aspect of global powers imperialism over peripherical States of the world, primarily since the Pax Americana (neoliberal hegemony). To achieve this crucial goal, Critical Theory and International Political Economy’s (IPE) methodologies will be essential, as well as the intrinsic relation between International Law and International Relations’ scopes of knowledge. The utmost result of this research highlights neo-colonial policies in DI’s background. Keywords: Neocolonialism; Neoliberalism; International Law; Hegemony; International Economic Governance

The Rise of Preferential Agreements in Global Economic Governance

We are experiencing a tumultuous period in global politics, with international economic governance facing a period of great uncertainty. Meanwhile, since the de facto collapse of the WTO’s Doha Round, a plethora of preferential agreements has begun to supplant the WTO’s rule-making function and to regulate the previously separate fields of international trade law and international investment law. This Special Issue has two objectives: to contribute to a greater understanding of the dynamics of preferential agreements as a source of new norms of global governance and their impact on the existing international trade and investment regimes, and to identify the implications that these developments have for States in their capacity as treaty negotiators and domestic regulators.

The life and times of embedded liberalism: legacies and innovations since Bretton Woods

In a widely cited 1982 article, John Ruggie identified the normative framework of Bretton Woods as ‘embedded liberalism’ and pointed to its enduring legacy in international economic governance through the 1970s. Revisiting Ruggie’s analysis at the 75th anniversary of Bretton Woods, I advance three arguments about the content and legacy of embedded liberalism in the international monetary and financial system. First, the embedded liberalism of Bretton Woods was an even more innovative normative framework than Ruggie’s important article suggested, involving a new commitment to a form of institutionalized liberal multilateralism that was compatible with various kinds of active public management of the economy. Second, in the 1944–1980 period, embedded liberalism was more contested and malleable than is often understood, as it coexisted with important alternative normative frameworks and as distinct varieties of embedded liberalism emerged in international monetary and financial governance. Third, in the post-1980 era, scholars have correctly highlighted a ‘neoliberalization’ trend in international monetary and financial governance, but assessments of the degree of the challenge posed to embedded liberalism by this trend need to be nuanced. They also risk overlooking different and newer kinds of challenges to embedded liberalism arising from growing opposition to institutionalized liberal multilateralism.

Beyond the ‘Moments’ of Law and Development: Critical Reflections on Law and Development Scholarship in a Globalized Economy

Abstract This paper aims to review and assess the contributions and limitations of law and development (L&D) as a field of legal scholarship in relation to the constitution of the international economy and global economic governance. It seeks to reflect on the theoretical and methodological contributions of L&D theory and practice on the development of international legal scholarship, particularly in the rapidly evolving field of international economic law. The intersections of economic theory, jurisprudence and legal theory and the institutional practice of development agencies and international economic organizations which are the focus of L&D scholarship provide a useful interdisciplinary prism through which developments in the regulatory framework of the global economy can be studied. Mapping the ways in which what Trubek and Santos call the three overlapping spheres of L&D – economic theory, legal theory and institutional practices – enables us to chart, understand and, where necessary, contest, the shifts in development theory and policy and institutional practice that influence and shape legal reform and scholarship.

Sustaining Multilateralism from the Bench

The ever-increasing surge in regional trade agreements (RTAs) over the past two decades has generated growing friction between regionalism and multilateralism in international economic governance, accompanied by serious challenges to the World Trade Organization (WTO) as an institution and a legal system. In this state of play and with the WTO’s negotiating arm trapped in persistent stalemate, several questions have arisen: What role, if any, has been played by the WTO dispute settlement system (DSS) in responding to the challenges posed to the WTO multilateral trade regime by RTA proliferation? What effect have these systemic challenges had on WTO jurisprudence? And how have these challenges shaped the judicial choices made by the WTO DSS in cases implicating substantive and jurisdictional questions located at the WTO-RTA interface? Based on a close analysis of WTO cases involving RTA-related issues, and unique empirical evidence generated through interviews with WTO practitioners having first-hand knowledge of the DSS’s work and the cases examined, this article shows that the DSS has not remained indifferent to the challenges presented to WTO rules and institutions by the increasing economic regionalization. Rather, in the series of RTA-related cases reaching its docket, the DSS has engaged itself in a long and enduring quest for sustaining the multilateral trading system from the bench. This quest has evolved along two parallel and mutually reinforcing trajectories—the substantive and the jurisdictional. These trajectories, when woven together, demonstrate how, in the shadow of textualism, a steady body of DSS jurisprudence emerged, animated by a judicial philosophy of seclusion from and ascendency over regionalism, and aimed at preserving the multilateral legal order in the face of the unabated surge in RTAs. This judicial philosophy, the article concludes, nevertheless entails some challenges and risks of its own, to the WTO and, more generally, to international economic law.

The United States-Mexico-Canada Agreement: A Glimpse into The Geoeconomic World Order

The United States-Mexico-Canada Agreement (USMCA) differs in a few important ways from prior trade deals signed by the United States but reveals a glimpse of the infrastructure for a new era in international economic governance. This new “Geoeconomic World Order,” will be characterized by great power rivalry between the United States and China, the intense use of protectionist tools to achieve strategic and political goals, and the diminished role of legal adjudication. This approach to trade policy will likely outlast the autocratic and/or nationalistic governments emerging around the world, including the current Trump administration. While international trade law will recover, it will look different in key respects—it will be less multilateral, predictable, justiciable, and enforceable. This more transactional view of international trade law implies a limit on the role of law and an increase in the use of power. It may force a retrenchment of international interdependence and a revival of zones of influence prevalent during the Cold War era.

Text of Trade Agreements (ToTA)—A Structured Corpus for the Text‐as‐Data Analysis of Preferential Trade Agreements

With multilateral negotiations at the World Trade Organization (WTO) in deadlock, rulemaking on international economic governance has shifted to preferential trade agreements (PTAs). To facilitate the scholarly investigation of the fast‐growing universe of PTAs, this article introduces a machine‐readable and structured full text corpus of 448 WTO‐notified trade agreements stored on a Github repository—the Text of Trade Agreements (ToTA) corpus. The article (1) provides a summary analysis of the ToTA corpus, (2) illustrates how text‐as‐data techniques can be used to investigate PTA design using ToTA, including through an interactive website accompanying this research, and (3) concludes with an overview of research applications involving this PTA text corpus in economics, political science, and law. The current codebook is attached herein as an appendix. The dataset, codebook, and code, as updated, are available at https://github.com/mappingtreaties/tota.

A discursive construction of the Belt and Road Initiative: From neo-liberal to inclusive globalization

An international consensus is emerging around the Belt and Road Initiative (BRI) proposed by the Chinese government, with a growing number of countries seeing it as a way of jointly exploring new international economic governance mechanisms. Meanwhile, with the crisis of neo-liberalism, economic globalization has arrived at a crossroad. In particular, incessant voices speak out against globalization, making the quest for a new way of promoting global development a major challenge. In this context, more and more political elites and scholars consider that the BRI opens up a possible new globalization path, amongst which inclusive globalization warrants exploration. On the basis of a brief analysis of the course and mechanism of global economic expansion and the limitations of neo-liberal globalization, along with the putting into practice of the BRI, this paper outlines some of the core features of inclusive globalization, i.e., inclusive growth with effective and efficient government regulation; inclusive infrastructure development; inclusive development paths chosen nationally that suit national conditions; inclusive participation; and cultural inclusiveness. Although these features are not sufficient to characterize fully inclusive globalization, they do identify some directions for future research, and provide elements of a discursive construction of the BRI.

The implications of the ‘Belt and Road Initiative’ on globalization and inclusive growth for the Eurasian continent

ABSTRACTThe ‘Belt and Road Initiative’ (BRI) and other emergent forms of transnational institution building raise new fundamental issues for economists and social scientists. Can BRI become a template for a new phase in the globalization process – a stage in which China takes a more proactive role? Can BRI help Central Asian economies that until now had been standing on the sidelines become fully integrated into the global division of labor? This article tries to analyze China’s potential of assuming a more central role in international economic governance and globalization process, which would also be in line with the size of its population and GDP. Further, the article analyzes the potential impacts of the BRI on inclusive growth for the poorly integrated Eurasian landmass by inspecting several direct and indirect channels.

Financing Sustainable Landscapes through Innovative International Economic Law and Governance Instruments

This article examines innovative ways to promote investment and financing of sustainable landscape initiatives in international law. It argues that increased flows of investment and finance for sustainable landscapes must be guided by a clear and comprehensive legal framework; better and more appropriate knowledge and technologies; more informed decision-making; and improved governance at all levels. The article considers concerns and opportunities to support the financing of sustainable forestry and land-use programs, especially in developing countries. It reviews the key contributions of international investment instruments to sustainability landscapes financing, in light of recent decisions concerning International Investment Agreements (iias) by arbitral panels convened to hear disputes under the rules of the International Centre for Settlement of Investment Disputes (icsid) or the United Nations Commission on International Trade Law (uncitral). It then proposes innovative ways that investment and financing rules might foster more effective implementation of innovative financing instruments, such as Landscape Funds in developing countries.

Proactively and steadily advancing China’s financial opening

ABSTRACTShould China continue to open its financial system? Our answer to this question is positive since financial opening is necessary for supporting economic innovation, containing financial risks and participating in international economic governance. However, the needs some new ideas in devising next-stage financial opening policies including replacing the experimental approach by more systemic method and top-level design, combining ‘using reform to assist opening’ and ‘promoting reform through opening’, and taking into full account of the spillover effects of Chinese financial policies. Finally, we make policy recommendations in seven key areas, including enforcing better policy coordination, devising macro-prudential regulations, increasing exchange rate flexibility, opening the domestic financial markets, relaxing restrictions on businesses of foreign financial institutions, improving external financing cooperation and adopting prudent cross-border capital flow management.

International Economic Disputes, Investment Arbitration and Intellectual Property: Common Descent and Technical Problems

Intellectual Property has always been at the heart of international economic governance. Indeed, the 1883 Paris Convention and the 1886 Berne Convention are commonly considered the first instances of international economic regulation. Hence, although the negotiation and adoption of the Agreement on Trade-Related Intellectual Property Rights (TRIPS Agreement) at the WTO and the inclusion of Intellectual Property (IP) rights among the ‘investments’ often covered under international investment agreements seem to have taken some by surprise, this convergence appeared inscribed in the genealogy of the subject. Many scholars have already paid attention to the relationship between trade, IP and investment, but the ‘technical’ issues that litigation in investment arbitration of IP rights (regulated at the national, regional and international level) might generate have apparently gone unnoticed. This article argues that further integration between the two regimes at the dispute settlement level is not desirable in practice for technical reasons. IP law and governance are highly fragmented and allocated among different fora at the international level. This situation is also reflected in the lack of agreement among states on several IP issues. The litigation of IP rights in investment disputes adds to this fragmentation instead of diminishing it and it appears as an attempt to unduly circumvent the discussions of IP questions taking place in intergovernmental fora.

Gunnar Myrdal and the Failed Promises of the Postwar International Economic Settlement

Gunnar Myrdal’s An International Economy: Problems and Prospects (1956) was Myrdal’s most systematic account of the postwar international economic order. This essay argues that it should be read as a coming to terms with the failures of planning during the 1940s for an ambitious and redistributive postwar system of international economic governance. In his calls for a “welfare world,” Myrdal attempted to revive certain policy proposals that had been popular during the early years of the Second World War, but which had been pushed aside during the run-up to the Bretton Woods Conference and its aftermath.

Breaking BEPS: The New International Tax Diplomacy

International tax avoidance by multinational corporations is now front-page news. In a time of public austerity, citizens and legislators around the world have focused on the erosion of the corporate income tax base. In response, in 2012 the G-20 — the gathering of the leaders of the world’s twenty largest economies — launched the “Base Erosion and Profit Shifting” (BEPS) project, the most extensive attempt to change international tax norms since the 1920s.This article is the first to explain that in the course of the BEPS project, the field of international tax has adopted the institutional and procedural architecture for multilateral action used in international financial law. But will that architecture work in the international tax context? To answer that question, the article applies lessons from the international financial law literature to assess international tax agreements that are now being reached through soft law instruments and procedures comparable to those that characterize international financial law. This initial analysis is largely pessimistic. However, the article then describes how model tax treaty law — although also a form of soft law — is highly effective, and differentiates the political economy of international tax law from that of international financial law. As a result, a key theoretical point emerges: bifurcating analysis of multilateral efforts to change international tax norms into their Model Treaty–based and non-Model Treaty–based components is necessary in order to understand the new regime for international tax governance. At a more practical level, bifurcating the analysis highlights that observers should expect the Model Treaty–based parts of the BEPS project to be implemented, as well as most parts of the project focused on tax transparency. By contrast, sustained international coordination in implementing other dimensions of the project is doubtful. In reaching these conclusions, the Article contributes to the broader international economic governance literature by using a high-profile example from international tax diplomacy to show how underlying legal institutions affect the prospects for implementation of international regulatory agreements.

China’s Coherence in International Economic Governance

This article analyzes China’s coherence in international economic governance. When and how is China challenging the rules and norms of the prevailing international economic order? Has China adopted the current rules and norms across the board, or is it proceeding in an ad hoc or piecemeal manner? How can its (in) coherence be explained? To address these questions, I compare China’s profile vis-a-vis three dimensions of the global economic order: trade, investment, and development aid. I argue that in international trade and investment, China has neither sought nor brought about significant change. China is however, offering an alternative to the Western norms that until now have dominated the global development aid regime. China’s establishment of the Asian Infrastructure Investment Bank (AIIB) is notable in this regard, though it is still soon to determine if the Chinese-led development bank will break with existing norms. The article then considers possible theoretical explanations for the variation in China’s behavior across the three areas.

Correcting twail’s Blind Spots

Third World Approaches to International Law (twail) may serve as an apt critique for examination of international economic governance from a Third World angle, given its intimate concern for the welfare of these States in international law. twail’s critique has improved significantly in terms of quality and quantity. Nevertheless, the critique continues to be plagued by a fundamental shortcoming, namely, it merely critiques international law systems and fails to provide suggestions for reforming them to suit the needs of Third World States. This is particularly true in relation to its critique of international economic governance. While twail has produced numerous critiques of the foreign investment and international trade regimes since its emergence, these have failed to provide any constructive suggestions for improvement in these areas. twail should therefore aspire to be more than a tool of system criticism and offer practical solutions to improve Third World States’ place within this system.

The political economy of the euro area's sovereign debt crisis: introduction to the special issue of the Review of International Political Economy

ABSTRACTThis special issue has two main aims: to examine the contribution of political economy analyses of the sovereign debt crisis and to relate these findings to longstanding debates in the sub-disciplines of comparative political economy, international political economy and European economic governance. This introduction begins by reviewing the comparative political economy literature on national financial systems in order to account for the playing out of the crisis. It then examines the international political economy literature on the International Monetary Fund (IMF) and financial (sovereign debt) markets that played such a key role in the unfolding of the sovereign debt crisis. Finally, it outlines longstanding academic debates on the main 'asymmetries’; in European economic governance, and provides a critical overview of the three main policy and institutional reforms adopted by European Union governments in response to the crisis.

Correcting TwaillS Blind Spots: A Plea for a Pragmatic Approach to International Economic Governance

Third World Approaches to International Law (TWAIL) has vehemently opposed classical doctrines of international law, which are perceived as being at odds with Third World interests, since its emergence. Its criticisms of international law are manifold but opposition to international economic governance (IEG) has been especially unyielding. Overtime this generated TWAIL critiques of IEG. These have manifested mainly in the new international economic order (NIEO) critique, influenced in the post-colonial era by earlier Latin American national economic control (NEC) theory. The NIEO critique refers to Third World attempts, from the 1960s to 1980s, to restructure international economic relations to establish an equilibrium between developing and industrial economies, thereby challenging the unfair international trading and finance rules advanced by developed countries. The debate has since experienced a paradigm shift towards greater critical analysis of Third World States’ participation in the global economy. This refers to the regime bias critique. Regime bias views the manner in which rules of IEG are crafted, applied and adjudicated between industrialized and developing countries, or between developing countries and the interest of global capital, as ‘unfair’. It rejects the manner in which choices are made between alternative ways of crafting rules, the meaning ascribed to a particular rule in its application by administrative agencies or at the adjudication stage by international tribunals in disputes involving developing countries. Albeit divergent in their approaches, both critiques view IEG as being at odds with Third World interests and have criticized the current regime as facilitating the post-colonial economic exploitation of Third World States only in a more nuanced manner than was the norm during colonialism. TWAIL’s critique has garnered some sophistication since its emergence. Nevertheless, it is still criticized for harboring blind spots. One such ‘blind spot’ is that while it may be the appropriate conceptual framework for leveling criticisms against international law, its criticisms, however, fail to offer pragmatic proposals for improvement. TWAIL’s critique fails to acknowledge that developing countries are generally not participating in the global economy to the degree necessary to boost their economies. This is problematic as it creates an adversarial relationship between developing countries and international law, thereby masking the potential for these States to develop under the aegis of the current regime. There exists the need for a more theoretically informed analysis than the lump-sum critique, which perceives international law as failing to take into account Third World interests. It would be more beneficial for TWAIL to be a source of reform, or more appropriately, a forum for constructive engagement of these States with IEG as this would create more meaningful participation of developing countries in the global economy.

Crossed Destinies: International Economic Courts and the Protection of Cultural Heritage

Economic globalization and international economic governance have spurred a more intense dialogue and interaction among nations—potentially promoting cultural diversity and providing the funds to recover and preserve cultural heritage. However, these phenomena can also jeopardize cultural heritage. Foreign direct investments in the extraction of natural resources have the ultimate capacity to change cultural landscapes and erase memory; trade in cultural goods can induce cultural homogenization. In parallel, legally binding and highly effective regimes demand states to promote and facilitate foreign direct investment and free trade. This article investigates the distinct interplay between the promotion of economic integration and the protection of cultural heritage before two separate international dispute resolution systems: i.e. investment treaty arbitral tribunals and the World Trade Organization Dispute Settlement Mechanism. It addresses the question as to whether international economic ‘courts’ pay adequate attention to the need of protecting cultural heritage, contributing to the coalescence of consistent narratives and emerging general principles of law. Has a cultural administrative law emerged requiring the protection of cultural heritage and an adequate balance between the same and the promotion of economic interests in international law? Are there specific contributions arising from each of the two dispute settlement mechanisms?

The Legitimacy of the G20 - A Critique Under International Law

The G20 has become the preeminent international economic and financial policy making body in the aftermath of the global financial crisis of 2007-2009. In the early phase of the financial crisis, the G20 made considerable progress with its measures to stabilize the global economy (London Summit of 2009). However, its subsequent initiatives have not kept pace with the challenges of a weakening global economy and the need for effective international financial regulatory reforms. This lack of success can be attributed in part to the G20’s unaccountable institutional structure that lacks legitimacy under international law. The G20's current institutional structure fails to respect the principle of a democratic and equitable international order as set forth in various United Nations instruments. To overcome these institutional shortcomings, this article considers a number of proposals to reform the G20 and to enhance international economic governance. This would lead to a redefined and broader mandate for the G20, allowing non-G20 countries to participate in a meaningful way in G20 policy formulation. It also suggests that the G20 integrate its operations more durably to existing international economic organisations, such as the UN ECOSOC, IMF, World Bank and WTO, in order to build a more effective and complementary global economic governance structure. By doing so, the G20 would enhance its effectiveness and credibility in addressing the important challenges facing the global economy.