Volume 1 Issue 1 (2020)

Abstract:

The sty is held to examine the extent of export earnings instability and its impact on the economic growth of Ethiopia in the period from 1970/71 to 2011/12. The instability in export earnings that results from dependence on a few primary commodities exports leads the country to uncertainty or shortage of foreign exchange earnings. Using the augmented neoclassical production function by incorporating export instability and adopting cointegration and/or error correction model technique, it was found that the export earnings instabilities negatively affect the economic growth of Ethiopia both in the short run and in the long run. Though the sign in the long and short run is the same, the significance of the coefficient of the short run is less than that of the long-run implying instability retards the economic growth more in the long run than the short run. As a measure of fluctuation in the export earnings, the deviation of actual export from exponential trending is used. The possible area of intervention is that trade policies should be consistent with the macroeconomic stabilization system. Thus, to mitigate the adverse effect of export instability on the growth, associated with commodity concentration, there has to be a policy shift to diversify the country's exports to include non-traditional exports in which their earnings do not similarly vary with major export commodities earnings. And precautionary saving and building up of foreign exchange at some level is essential to smooth the short-run impact. These measures are expected to cause in a significant result in the growth process.

Abstract:

In absence of any global treaty, the bilateral investment treaties are playing an important role of regulating foreign investments in the host countries. According to the United Nations Conference on Trade and Development, there are 2361 bilateral investment treaties are in force and like other members of the World Trade Organization Malaysia also signed bilateral investment treaties to facilitate trade. The primary purpose of economic globalization is the economic development of the developing and least-developed countries as well as to facilitate benefits of the home states. Malaysia foreign investment laws and bilateral investment treaties mainly protects foreign investors, however, neither of them has any specific provision regarding performance requirements from foreign investors. This paper addresses two questions: (a) Do the bilateral investment treaties of Malaysia allows the host state to impose performance requirements from foreign investors? (b) Should the foreign investors be required to fulfil performance obligation during the entry of foreign direct investment in Malaysia? Using doctrinal research method, we critically analyzed 15 bilateral investment treaties to explore whether there is any reference of fulfilling performance requirements in Malaysia. We find that except Malaysia-Germany BIT, rest of the Malaysia bilateral investment treaties has provisions to promote and protect foreign investments but has no reference of fulfilling performance requirements; therefore, the government of Malaysia should consider this important factor while signing any future bilateral investment treaties.