Chapter 1: You are a developing country. Post-decolonization, your economy is based on unprocessed commodities, but you would like to increase domestic manufacturing and improve infrastructure. What do you do? If you want to go it alone, go to Chapter 2. If you want some outside help, go to Chapter 3.
Chapter 2: You can either try to develop on your own by protecting your own infant industries or you can continue to supply unprocessed commodities to the rest of the world. Your reputation as a place to invest may not be that great. Good luck staying an irrelevant backwater!
Chapter 3: Your friends at the World Bank and the IMF tell you to liberalize your economy and attract foreign direct investment. What do you do? If you want to take their advice go to Chapter 4. If you decide to ignore it, go to Chapter 2.
Chapter 4: You hear that some states to the north have something called Bilateral Investment Treaties (BITs) that you can sign, and companies and citizens from that state will then invest in your projects and industries. You might have to accept some private competition in formerly public services, or promise not to raise taxes or increase environmental regulations, but that’s the price of development, right? Want to sign one of these treaties? Go to Chapter 5. Not sure it’s a good idea? Go to Chapter 2.
Chapter 5: You sign! And the investment starts flowing in. Everything’s going great, until some citizens start complaining that some of these big development projects are causing environmental problems. More worrying, they’ve got some international NGOs to start a campaign that makes you look really bad. You’ve got a norm conflict on your hands! What do you do? Ignore your citizens? Go the Chapter 6. Want to address their concerns? Go to Chapter 7.
Chapter 6: Your citizens are unhappy. Depending on how bad it gets, you can just ignore it, or you can send some police to quiet things down. Hopefully they’ll forget all about it at election time. Anyway, they’ll come around, once the wealth starts trickling down, right? Good luck!
Chapter 7: You decide to take some measures and strengthen environmental regulations. Your people are happy, and so are the NGOs. But, you’ve pissed off some investors and they are threatening to sue in private arbitration. What do you do? Scrap the new regulations, and go to Chapter 6. Or decide to stick to your guns and go to Chapter 8.
Chapter 8: You’re getting sued in private arbitration. This means three lawyers will decide, based only on the text of that treaty you signed, whether those regulations you passed violate the BIT. They decide that the economic damage caused by your regulations constitutes indirect expropriation and you have to pay a large sum in compensation. What do you do? Well you don’t really have much of a choice. Pay the investors or go back to Chapter 2. Looks like you learned your lesson!