Impact of Bilateral Investment Treaties on Foreign Direct Investment Inflows To Vietnam

Abstract

The effect of Bilateral Investment Treaties (BITs) on FDI inflows to Vietnam remains unexplored despite the proliferation of treaties that the government efforts to sign to attract foreign investment at the end of last century. This paper asks whether BITs stimulate FDI flows to Vietnam by using different explanation variables and various estimation technique to test the robustness. I find a very weak positive relationship between BITs and FDI, though effects of FTAs and WTO are estimated to promote FDI flows into ietnam. My results show the importance of accounting for guiding investment policies to narrow down the gap between law regulations and provision of BITs.