survey of multinationals (MNCs) has revealed that foreign
investors are more likely to encounter rule of law (RoL) issues
in the US than China.
It also shows that executives place increasing
weight on RoL when identifying target markets, and that they
have more faith in domestic legislation than bilateral
investment treaties (BIT) in protecting their investments.
The report, titled Risk and return: foreign direct investment and the
rule of law, is based on the responses of 301 senior
decision makers from the Forbes
global 2000 list.
Its most striking findings are in relation to
China. Despite its reputation as a notoriously difficult
jurisdiction to operate in, only 13% of respondents active in
the country had encountered RoL issues over the past five
"Once they are actually in the country, they told us that
over 80% of the time they don’t actually encounter
rule of law issues day...