The Potential Value-Added of a Multilateral Framework on Investment Facilitation for Development

Abstract

This article argues that investment facilitation needs to be seen in the context of the principal FDI determinants and, in particular, the all-important economic determinants. Beyond that, when negotiating a multilateral framework on investment facilitation for development, it is crucial to (1) give full attention to the development dimension of investment facilitation, by promoting sustainable FDI for sustainable development; (2) establish an inventory and benchmark of good practices regarding investment facilitation, with ground-level input by practitioners;(3)keep in mind that the framework can help domestic reforms; (4) require transparency for home country measures and investors’ corporate social responsibility commitments; and (5) ensure that the framework provides for technical assistance to developing countries (and especially the least developed among them) for negotiating and implementing such a framework. Developing countries in particular need to seek to advance these issues. If substantial progress toward an explicit development dimension can be made (or, at a minimum, some of these issues can become part of a firm built-in agenda for future negotiations), a multilateral framework on investment facilitation for development would create a value-adding instrument in the FDI tool-box that is currently available in the international investment area.