‘Pastis Power Europe’: An Assessment of the EU’s Actorness in International Investment Politics. EU Diplomacy Paper 06/2016

Topete, Paloma Díaz (2016) ‘Pastis Power Europe’: An Assessment of the EU’s Actorness in International Investment Politics. EU Diplomacy Paper 06/2016. [Working Paper]

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Abstract

This paper assesses the extent to which the transfer of exclusive competence over foreign direct investment to the European Union (EU) in the Treaty of Lisbon allows it to become a strong actor in the international investment arena. Drawing on legal and international political economy concepts, it challenges a widespread assumption according to which an exclusive EU competence would benefit not only its economic competitiveness but also increase the attractiveness of its regulatory system. Legal and political problems, arising from the limits to the EU’s competence in Union law and from its awkward interaction with international investment law, limit its ability to negotiate favourable international investment agreements and imply that the EU’s role in this field is unlikely to come to parallel its salient position in trade. Indeed, the transfer of competence might give rise to a paradoxical situation in which the EU’s international bargaining position is weakened not only in investment but also in international economic policy-making more broadly regarded.

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