European political elites seem to be indulging in a degree of scapegoating about the danger from “ChinIndia”, since the roots of European angst really lie, among others, in European difficulties in managing globalization, declining competitiveness, fear of change, and an unsustainable health, pension and social welfare system. The Europeans tends to perceive the Chinese juggernaut as a direct immediate threat to European jobs in some manufacturing sectors whereas India is seen as a latent and potential threat taking away service-sector jobs, though pressures would increase as both move up the value chain.

The European Union’s strategic partnership with China and India is essentially driven by trade and commerce. India has too much of catching up to do with China. India is clearly in the Commonwealth Games league whereas China is in the Olympic Games league.

The rise of China and India represents both challenges and opportunities for Europe. Rising powers like China and India are challenging the European Union. They will be in a position to shape and influence global agendas and decisions to a greater extent than at present. For both, Europe will remain an indispensable partner since it is a vital source of trade, advanced technology and foreign direct investment. China and India do pose challenges for Europe, but they also provide opportunities since their growth contributes to greater growth worldwide, which means more exports, especially to a swelling consumerist middle class, which will make more demands of European goods, technology, and services.

The current boom of investment arbitration under NAFTA as well as ICSID and other arbitral regimes has demonstrated that the enforcement of treaty obligations has become a standard feature of international law in this particular field of international economic law. The increased probability of actual enforcement of international standards of investment protection is generally welcomed in a system, such as the international legal order, which normally suffers from rather weak enforcement structures. At the same time, the proliferation of investment dispute settlement mechanisms bears its own risks. The concurrent availability of different investment dispute settlement mechanisms may lead to parallel proceedings or to the re-litigation of already decided cases. The CME/Lauder v. Czech Republic arbitrations where the same dispute was arbitrated under two different bilateral investment agreements and the CMS v. Argentina and the LG&E v. Argentina cases where similar issues were addressed demonstrate the inherent danger of a multiplication of procedures if the answers found by different tribunals are contradictory. The proliferation of investment disputes has broader structural implications which need to be addressed in order to secure the viability of this system of international arbitration.

August Reinisch is professor of public international law and European law at the University of Vienna. From 2004 to 2006 he served as Dean for International Relations of the Law School of the University of Vienna. He is also a professional lecturer at the Bologna Center/SAIS of Johns Hopkins University. He currently serves as arbitrator on the In Rem Restitution Panel according to the Austrian General Settlement Fund Law 2001 and as president of an UNCITRAL investment arbitration.

He holds Master's degrees in philosophy (1990) and in law (1988) as well as a doctorate in law (1991) from the University of Vienna and an LL.M. (1989) from NYU Law School. He is admitted to the Bar of New York and Connecticut (since 1990).