I am pleased to share with you the 8th
issue of our joint UNCTAD-OECD
Report on G20 Investment Measures.
While G20 members continued to honour their pledge not to introduce new
restrictive investment measures, the Report suggests that a closer look
at current developments reveals a more nuanced picture.
The 8th joint Report builds on
the findings of UNCTAD’s Tenth Global
Investment Trends Monitor and notes
that in the first half of 2012, global foreign direct investment (FDI)
flows fell by 8 per cent compared to the first half of 2011. Among others,
this reflects increased turmoil in the global economy which was marked
by fears of sovereign debt crisis in Europe and a slowdown of growth in
major emerging market economies.
During May 2012 to October 2012 reporting
period, sixteen G20 members took some sort of investment policy action,
i.e. adopted investment-specific measures or investment measures relating
to national security or concluded international investment agreements.
· Six
countries, Brazil, Canada, India, Mexico, the Russian Federation and Turkey,
amended their investment-specific policies (those not designed to address
national security) during the reporting period.
· Two
G20 members, France and Italy, amended their investment policies related
to national security.
· Sixteen
G20 members concluded in total, eight new international investment agreements
(IIAs), including four bilateral investment treaties (BITs) and four
“other IIAs”,.
On the whole, G20 members have continued
to honour their pledge not to introduce new restrictive measures. G20 members
adopted few new investment policy measures during the reporting period
and almost all tended to eliminate restrictions to, and to facilitate,
foreign investment.
Despite this encouraging finding, persistent
high unemployment, turbulence in financial markets and a weak economic
recovery put intense pressure on governments to grant assistance to individual
domestic companies and to preserve jobs. As a result, governments may resort
to policies or practices that discriminate against foreign investors or
discourage outward investment, an issue also analysed in UNCTAD’s 2012
World Investment Report. Governments
may also be tempted to yield to such pressure in informal and diffuse ways
that are not manifested as policy changes, thereby undermining all the
more investors’ trust in predictable and transparent frameworks in host
countries.
Following the call by G20 Leaders at their
Los
Cabos Summit, both UNCTAD and the OECD
are committed to reinforcing and deepening their work towards enhancing
investment policies through monitoring of policy developments.
The report was prepared in response to G-20
leaders' reaffirmed commitment to resist protectionism, made at their summit
meeting in Los Cabos, 18-19 June 2012 where leaders called on UNCTAD, the
World Trade Organization and the Organisation for Economic Cooperation
and Development to continue monitoring the situation and to report on it
publicly on a semi-annual basis.
In their Los Cabos Declaration, Leaders also
called on the three organizations to accelerate their work on analyzing
the functioning of global value chains and their relationship with trade
and investment flows, development and jobs.
I hope that you find this information interesting
and welcome any comments you may have. Let me invite you to also visit
our recently upgraded Investment
Policy Hub, and share this information
with your networks.
With best regards,
James Zhan
Director
Investment & Enterprise Division
United Nations Conference on Trade & Development
Palais des Nations, Geneva
Tel: +41 22 9175797
www.unctad.org/diae
Twitter: @unctadwif
