The Protracted Bargain: Negotiating the Canada–China Foreign Investment Promotion and Protection Agreement

Abstract

SummaryIn 1994, Canada and China began negotiating a bilateral foreign investment promotion and protection agreement (FIPA). After sixteen years and multiple rounds of negotiations, the two states have not been able to solidify a workable treaty. By examining each country’s substantive and procedural preferences in their respective bilateral investment treaty models and in past treaties, this article outlines some of the likely “on-the-table” obstacles in the negotiating process. The analysis indicates that there are areas of considerable convergence between each country’s preferences, although significant areas of divergence exist on some key issues. Further confounding the disagreement that exists between the two countries are “off-the-table” factors such as general bilateral relations. One further aspect that is considered is the idea of coordinating compliance between international trade and human rights norms in the context of the Canada–China FIPA. While bilateral investment treaties are economic agreements, pronounced non-economic elements shape the practical and legal effect that these treaties have on various affected actors. Despite the important implications the Canada–China FIPA has for human rights and environmental policy concerns, it can be inferred that these factors will have little bearing on the actual negotiated outcome of the agreement.