The effect of the number of Bilateral Investment Agreements (BIT) on Foreign Direct Investment (FDI) in 217 countries

Abstract

The objective of the research was to correlate the amount of Bilateral Investment Treaties (BIT) and Foreign Direct Investment (FDI). The methodology was correlational, for the variable ¨X¨, the database of Bilateral Investment Treaties (BIT) prepared by the United Nations Conference on Trade, Investment and Development (UNCTAD) from 1900 to 2019 and for the variable ¨Y¨ the database of Foreign Direct Investment (FDI) entry and net exit in millions of United States dollars (USD), prepared by the World Bank, was used. The research determined that between 1950 and 1990 the correlation was -0.15 and 0.01, a weak relationship; between 1990 and 2008, a moderate negative relationship from -0.25 to -0.01, at this stage the subscription, approval, ratification, signature and validity increased; and a stabilization is noted as of 2010, going from -0.01 to 0.06 moderately positive force. 80% of FDI is concentrated in 20 countries out of 217, from 1970 to 2019; Since 1990 we have verified greater mobility, FDI is not “Intra progresis”, it is “investment est optimatium”, there are countries such as the British Virgin Islands, Malta and Liechtenstein where FDI is very high.