*Karl P. Sauvant, PhD*
*Resident Senior Fellow*
*Columbia Center on Sustainable Investment*
Columbia Law School - The Earth Institute, Columbia University
435 West 116th St., Rm. JGH 825, New York, NY 10027
| p: (212) 854 0689 | cell: (646) 724 5600 e: [log in to unmask]
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"Emerging Markets and the International Investment Law and Policy Regime",
"Sustainable FDI for Sustainable Development", "Towards an Investment
Facilitation Framework: Why? What? When?", "Beware of FDI Statistics!",
"Towards an Indicative List of FDI Sustainability Characteristics", “The
Importance of Negotiating Good Contracts", "A New Challenge for Emerging
Markets: the Need to Develop an Outward FDI Policy”, "China Moves the G20
toward an International Investment Framework and Investment Facilitation", "The
Next Step in Governance: The Need for Global Micro-regulatory Frameworks",
and "The Evolving International Investment Law and Policy Regime: Ways
Forward" *are* available at and

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*Columbia FDI Perspectives*
Perspectives on topical foreign direct investment issues
No. 224  April 23, 2018
Editor-in-Chief: Karl P. Sauvant ([log in to unmask])
Managing Editor: Marion A. Creach ([log in to unmask])
*What’s next for the investment facilitation agenda?*
* <#m_-2839632813383753283__edn1>
Axel Berger** <#m_-2839632813383753283__edn2>

Investment facilitation has been gaining in popularity in recent years’
policy debates, surely inspired by the successful adoption of the WTO’s
Trade Facilitation Agreement. “Investment facilitation” refers to actions,
mainly by host countries, to make legal and administrative rules and
procedures more transparent, predictable and efficient. Home countries can
support investment facilitation by, e.g., assisting host countries to
implement the necessary reforms. Considering that international investment
policy-making faced severe criticism in recent years, proponents stress
that investment facilitation is *not* about market access, investment
protection or investor-state dispute settlement.[1]
<#m_-2839632813383753283__edn3> As all countries want to attract foreign
investment, some argue that investment facilitation should be a
“no-brainer.”[2] <#m_-2839632813383753283__edn4>

The idea of an investment-facilitation agreement was born in the
discussions of the E15 initiative in 2015.[3]
<#m_-2839632813383753283__edn5> During the Chinese presidency, the G20
ventured into new areas by advancing a comprehensive work agenda on
investment.[4] <#m_-2839632813383753283__edn6> Although the adoption of the
nine “Guiding Principles for Global Investment Policymaking” received more
attention at the time, the G20 also encouraged international organizations
such as UNCTAD, the World Bank, the OECD, and the WTO to work on investment
facilitation to inform future G20 discussions.

The discussions were continued during the German G20 presidency, aiming to
agree on a non-binding investment-facilitation package that included the
fostering of open and transparent business climates and actions to promote
inclusive economic growth. However, negotiations collapsed at the last
minute, due to the opposition of India, South Africa and, unexpectedly, the
US. The final G20 Hamburg Summit declaration included only a vague
reference: “We will seek to identify strategies to facilitate and retain
foreign direct investment.”[5] <#m_-2839632813383753283__edn7> Investment
facilitation is not part of the agenda of the 2018 Argentinian G20

The WTO has a troubled history with attempts to negotiate investment rules.
Rules on trade-related investment measures and services trade (covering
also commercial presence) were agreed upon in the Uruguay Round. Attempts,
however, to advance an investment agenda through a dedicated WTO working
group ended during the 2003 ministerial conference in Cancun in a spat
between emerging and advanced economies.

It is interesting, therefore, that recent attempts to initiate WTO
rule-making on investment facilitation are mainly driven by emerging
economies, including China and Brazil. In the run up to the 11th WTO
Ministerial Conference in Buenos Aires (December 2017), a number of
emerging economies tabled proposals to inform the other members of an
informal process on investment facilitation that they wanted to launch.
Investment facilitation was not part of the official negotiation agenda in
Buenos Aires. This did not prevent a group of 41 countries and the European
Union from adopting, on the margins of the Conference, a Joint Ministerial
Statement on Investment Facilitation for Development that called for the
start of “structured discussions with the aim of developing a multilateral
framework on investment facilitation.”[6] <#m_-2839632813383753283__edn8>
Subsequently, Brazil circulated an illustrative text to facilitate
discussion on the issue,[7] <#m_-2839632813383753283__edn9> and 86
delegations met for a first structured dialogue on investment facilitation
on March 13, 2018 in Geneva. Recent media reports indicate that India is
rethinking its opposition to multilateral talks on investment facilitation.
[8] <#m_-2839632813383753283__edn10>

There are three scenarios how the international investment-facilitation
discussion can move forward:

   - Countries can unilaterally reform their domestic regulatory
   environments for foreign investment. These national actions, however, could
   be encouraged and guided by a set of binding international rules that may
   be necessary to catalyze deep-rooted national reforms.
   - Countries interested in developing international
   investment-facilitation rules can pursue a plurilateral agreement. Given
   the momentum that has been building up, this approach seems to be the most
   promising—at least for now. Ideally, such a plurilateral approach would be
   housed within the WTO and its rules would apply on a most-favored-nation
   - Investment-facilitation rules can be negotiated multilaterally, among
   all WTO members. A multilateral framework is preferable to reconcile
   interests. It would provide better possibilities to discuss the
   responsibilities of home countries of foreign investors, and, similar to
   the Trade Facilitation Agreement, it would allow linking the implementation
   of rules with provisions on capacity building.

International investment-facilitation discussions have been dynamic since
the idea was proposed by a group of experts in 2015. This shows, contrary
to popular belief, that WTO members can act swiftly if a topic is ripe for
action. However, the unexpected difficulties encountered in getting the
trade facilitation agreement done should serve as a reminder that, even
when it comes to no-brainers, anything can happen in multilateral

* <#m_-2839632813383753283__ednref1> *The Columbia FDI Perspectives are a
forum for public debate. The views expressed by the author(s) do not
reflect the opinions of CCSI or Columbia University or our partners and
supporters. Columbia FDI Perspectives (ISSN 2158-3579) is a peer-reviewed
** <#m_-2839632813383753283__ednref2> Axel Berger ([log in to unmask])
is a Senior Researcher at the German Development Institute/Deutsches
Institut für Entwicklungspolitik (DIE). The author is grateful to Michael
Gestrin, Alejandro Jara and Rashmi Jose for their helpful peer reviews.
[1] <#m_-2839632813383753283__ednref3> WTO, “Joint ministerial statement on
investment facilitation for development,” WT/MIN(17)/59,
[2] <#m_-2839632813383753283__ednref4> Karl P. Sauvant, “Opening remarks:
sixth roundtable facilitating investment for sustainable development,”
October 30, 2017,
papers.cfm?abstract_id=3066336, p. 2.
[3] <#m_-2839632813383753283__ednref5> Karl P. Sauvant and Khalil Hamdani,
“An international support programme for sustainable investment
facilitation,” July 2015,
content/uploads/2015/09/E15-Investment-Hamdani-and-Sauvant-Final.pdf /.
[4] <#m_-2839632813383753283__ednref6> Karl P. Sauvant, “China moves the
G20 on international investment,” *Columbia FDI Perspectives*, No. 190,
January 2, 2017,
[5] <#m_-2839632813383753283__ednref7> “G20 leaders’ declaration,” July
7-8, 2017,
[6] <#m_-2839632813383753283__ednref8> WTO, op. cit.
[7] <#m_-2839632813383753283__ednref9> WTO, “Structured discussion on
investment facilitation: communication from Brazil,” January 31, 2018,
[8] <#m_-2839632813383753283__ednref10> Livemint, “WTO: India may drop
opposition to investment facilitation treaty,” February 21, 2018,
*The material in this Perspective may be reprinted if accompanied by the
following acknowledgment: “Axel Berger, ‘What’s next for the investment
facilitation agenda?**’ Columbia FDI Perspectives, No. 224, April 23, 2018.
Reprinted with permission from the Columbia Center on Sustainable
Investment (** <>**).” A
copy should kindly be sent to the Columbia Center on Sustainable Investment
at **[log in to unmask]* <[log in to unmask]>*.*

For further information, including information regarding submission to the
*Perspectives*, please contact: Columbia Center on Sustainable Investment,
Marion A. Creach, [log in to unmask]

*Most recent Columbia FDI Perspectives*

   - No. 223, David Chriki, “Investment arbitration liability insurance: a
   possible solution for concerns of a regulatory chill?” April 9, 2018.
   - No. 222, Makane Moïse Mbengue, “Facilitating investment for
   sustainable development: it matters for Africa,” March 26, 2018.
   - No. 221, Karl P. Sauvant and Howard Mann, “Sustainable FDI for
   sustainable development,” March 12, 2018.

*All previous FDI Perspectives are available at
<>**. *

*Other relevant CCSI news and announcements*

   - *Save the Date: September 27-28, 2018:* This year, CCSI’s Annual
   Columbia International Investment Conference (CIIC) is on “Multinationals
   in the Age of Sustainable Development: New Thinking on the Role of
   International Investment Agreements.” The Conference, taking place
   alongside the 73rd Session of the UN General Assembly in New York, will
   build on a multi-year effort to identify guiding principles and practical
   approaches for aligning international investment treaties with the
   Sustainable Development Goals (SDGs). Additional information will be posted
   shortly on our website here
   - CCSI is still accepting applications for our upcoming executive
   training: Investment Treaties and Arbitration for Government Officials
   (July 30-August 9, 2018). The program is designed to equip participants
   with the necessary skills, analytical tools, and frameworks to address
   relevant challenges and opportunities, and to encourage a rich dialogue
   about best practices from around the globe. *More information about the
   training, including the brochure and application, is available at the link
   - CCSI has released its 2016-2017 Annual Report. *The full report is
   available here

Karl P. Sauvant, Ph.D.
Resident Senior Fellow
Columbia Center on Sustainable Investment
Columbia Law School - Earth Institute
Ph: (212) 854-0689
Fax: (212) 854-7946
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