USCIB and its international affiliate partners through Business at OECD (BIAC) remain on the front lines, defending solid, pro-investment policies at multilateral fora this fall.
USCIB President and CEO Peter Robinson participated in the UN Committee on Trade and Development’s (UNCTAD) seventh World Investment Forum (WIF) as part of the Global Leader’s Investment Summit on October 19. “Now more than ever, it is important for international organizations like the UN and its member governments to provide the necessary welcoming environment for foreign direct investment in quality industry and infrastructure projects that help with pandemic relief and sustainable economic growth,” said Robinson. “Otherwise, the pandemic exacerbated investment gap will persist with the developing world most at risk.”
Robinson also called for a strong and sustained role for industry, as a key stakeholder, in the discussion on investment at UNCTAD, the UN Commission on International Trade Law (UNCITRAL), the OECD or elsewhere. His remarks were echoed by other industry representatives and welcomed by some developing countries like Egypt. Opposing views were led by development economist Jeffrey Sachs and countries like Pakistan that would like to see radical “reform” of the investor state dispute settlement mechanism and reduction or elimination of protections for foreign investors.
USCIB Senior Advisor Shaun Donnelly was a lead private sector speaker at a parallel “experts meeting” on International Investment Agreements in the same virtual UNCTAD World Investment Forum week. Donnelly forcefully defended investor protections, including a strong Investor-State Dispute settlement System (“ISDS”) as necessary protection against host government discriminatory or unfair treatment of foreign investors.
There was discussion at WIF of establishing a multi-stakeholder “World Investment for Development Alliance” to facilitate greater collaboration between intergovernmental organizations, business entities, academic initiatives and civil society groups and to develop enabling frameworks to address international investment and sustainable development outcomes. USCIB will follow this proposal closely to ensure our active participation.
Donnelly and BIAC Investment Committee Chair Winand Quaedvlieg (Netherlands) led BIAC’s participation in the OECD Investment Committee’s semi-annual fall meetings. In a free-wheeling brainstorming session on investment treaties on October 28, Donnelly made a major intervention that a government’s right to regulate is not a right to discriminate or abuse investors, to be arbitrary or to be non-transparent. He pointed out that “policy space” promoted by some governments and NGO participants should not translate into a “carte blanche” for governments to treat investors badly. But unfortunately, according to Donnelly, some governments continue to do just that, underscoring the need for strong investor protections.
Donnelly also joined Chairman Quaedvlieg on October 27 at a formal “stakeholder consultation” with the OECD Investment Committee leadership. That session, where BIAC joins with labor union representatives from the Trade Union Advisory Council (TUAC), as well as civil society group OECD Watch, was an opportunity for each of the stakeholders to lay down priorities and basic positions on future work in the OECD Investment Committee.
Donnelly and USCIB Director for Investment, Trade and China Alice Slayton Clark, remained engaged this fall in informal consultations with U.S. government leaders to press the importance of investor state dispute settlement and positive Biden Administration messaging on the investment climate. The messages built on the above, encouraging conducive taxation frameworks, facilitation of administrative procedures, complementary public investments in modern infrastructure and the right mind- and skill sets, and sound investment protection and general predictability.
Finally of note, USCIB continues to work with BIAC to share business views with respect to development of the OECD Foreign Direct Investment Qualities toolkit, designed to help policymakers create an enabling environment for attracting Foreign Direct Investment that safeguards key sustainability goals: productivity and innovation; employment, job quality and skills; gender equality; and, low-carbon transition. The toolkit is earmarked as a key deliverable for next fall’s OECD Ministerial Council Meeting.
According to Clark, “All of these interventions provided a great opportunity for USCIB to remind government officials at the national and international level of the importance of foreign direct investment to economic development, recovery and sustainability, particularly in the face of a pandemic induced downturn. As such, we must continue to maintain strong investor protections in international investment agreements.”