Foreign investment has been hailed as a key force in propelling the ongoing integration of the world economy, providing growth in the world's emerging markets, stimulating competition and innovation in industrial country markets, and transferring technology and skills worldwide. To its detractors, foreign investment means domestic firms moving abroad with job losses at home.

Currently, there are hundreds of bilateral investment treaties (BITs) governing foreign investment. Provisions in these BITs vary substantially from country to country, and they fail to address a number of key issues that have arisen with the globalization of production.

This year, the Organization for Economic Cooperation and Development hopes to conclude the first comprehensive multilateral rules for international investment. The Multilateral Agreement on Investment (MAI), once completed, will be open for signature by all countries. It seeks to give investors greater protection against expropriation and other arbitrary acts, establish legally binding procedures for settlement of investment disputes and create a uniform set of rules on investor protection and market access currently not available under BITs.

This issue of "Economic Perspectives" examines proposed new global rules on investment, the link between trade and investment, and growing efforts to stop one of the major impediments to financial flows -- bribery and corruption.