Winds of change? Uncertain times for global trade and investment
Spring is always a time of renewal and change, and change is certainly in the air when it comes to the overall structure of international cooperation and the rules governing trade and investment. The daily headlines of a possible trade war between the United States and China suggest that the landscape as we have known it for so many years is changing rapidly.
What all this means for developing countries has yet to take shape, but it is clear that protectionist policies, tariffs, and the renegotiation of multilateral trade agreements have created uncertain times for global trade and investment. At the same time, the uncertainty in the air has created new space to discuss how trade relates to many other policy areas that are essential for the achievement of sustainable development: poverty reduction, job creation, innovation, and environment to name a few.
We discussed the dynamics between these competing needs and goals last week with the heads of the International Labour Organization, the International Trade Centre, and the United Nations Office at Geneva in a working session co-organized by IISD and partners in Geneva. How do they view the current trends and developments on trade and what changes would be needed to achieve trade that is more just and advances sustainable development? This discussion was followed by an expert meeting on the future of multilateralism and perspectives from the Global South.
At this time of change we also want to share with you some other highlights of how we have been working with developing and emerging economies to advance reform, leverage economic benefits for sustainable development, finance sustainable infrastructure and promote meaningful investment agreements over the past few months. As always, we welcome your feedback and look forward to the opportunity to engage with you further.
Nathalie Bernasconi-Osterwalder
Group Director, Economic Law and Policy Program
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Annual Investment Forum: Sharing challenges, advancing solutions
More than 140 government officials gathered in Nairobi in February for the 11th Annual Forum of Developing Country Investment Negotiators, co-organized by IISD, KenInvest and the South Centre.
Each year, this forum gives peers from developing countries an opportunity to discuss common challenges and to advance a reform agenda regarding investment law and policy.
The call for reform stems from a rising number of costly disputes filed by foreign investors against governments. These disputes, or sometimes just the fear of a dispute, can lead governments to stall decisions on critical policies related to, among other things, public health, taxation and environmental protection.
The Annual Forum helped prepare negotiators for the process at the UN Commission for International Trade Law (UNCITRAL), where the reform of investment dispute settlement is currently being discussed.
In collaboration with the Columbia Center on Sustainable Investment and the International Institute for Environment and Development, IISD will facilitate a session for interested members of the public (e.g., civil society, academia, practitioners) to present their views on the issues being discussed at the upcoming meeting of UNCITRAL, which takes place in New York from April 23 to 27, 2018. We will also coordinate follow-up meetings to the discussions held with developing countries at the Annual Forum.
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Sustainable public procurement and infrastructure investment
The new Sustainable Infrastructure Portal, a project by the Mava Foundation and IISD, helps governments, citizens and financiers address the challenges in closing the USD 90 trillion global infrastructure gap and helps to position infrastructure as the catalyst for realising the Sustainable Development Goals. The portal serves as a repository of news and views on the financing of sustainable infrastructure. Sign up to receive updates.
The portal also features information on the innovative Sustainable Asset Valuation (SAVi) tool, which the government of Senegal recently began to pilot. SAVi assesses environmental, social, economic and governance risks and helps governments and investors understand the business case for sustainable infrastructure. Senegal will be testing the tool on mining infrastructure projects following a January workshop. We are also working on projects in Cape Verde, India, Kenya and Morocco.
Our procurement and investment teams are also working with governments and other stakeholders to ensure that legal and policy tools used in the infrastructure investment processes integrate sustainable development considerations. This effort includes work on public–private partnerships (PPPs) in infrastructure and was the topic of an event co-organized with UNCTAD ahead of the Annual Forum in Nairobi (PPP workshop).
We also launched our report on moving towards sustainable performance-based procurement in the Western Cape in Cape Town, South Africa, in partnership with WWF-South Africa.
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Foreign investment opportunities for agriculture
Agriculture is increasingly seen as a driving force for economic transformation in Africa. Our agricultural investment team continues to work closely with African parliamentarians and officials on how best to manage the explosive growth of large-scale land deals and how to promote responsible investment.
A critical aspect of this involves focusing on gender dimensions, as promoting gender equality and women’s empowerment is increasingly recognized as a key driver for food security, poverty reduction and rural development. During the 2nd Ordinary Session of the Economic Community of West African States (ECOWAS) Parliament, IISD joined with partners including ECOWAS, the Food and Agriculture Organization (FAO) and Oxfam to organize a workshop on Promoting Gender Equality in Agricultural Investments in Land in Africa.
The workshop was a chance for IISD to present the results of a new report and also to introduce a new tool, developed with Oxfam, to help promote meaningful community engagement with large-scale land-based investments in agriculture in Africa.
Another important meeting focused on the importance of strengthening and enhancing the negotiating capacity of government officials in charge of negotiating and/or drafting agricultural investment contracts in Common Market for Eastern and Southern Africa (COMESA) and East African Community (EAC) member states.
For more information on IISD's work on food security and investment, please visit our SDG 2 page.
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Leveraging mining for sustainable development
The Intergovernmental Forum on Mining, Minerals, Metals and Sustainable Development (IGF) released its 2017 annual report in March. The report highlights successes throughout the previous year and puts a spotlight on how leveraging mining for sustainable development can limit negative impacts and ensure financial benefits are shared.
To achieve this, countries must ensure that the exploitation of their resource wealth results in significant, sustainable and inclusive benefits for the host country and its communities. To that end, the IGF released draft guidance for governments on local content policies at Investing in Africa Mining Indaba. We are also moving forward on guidance for countering tax base erosion and profit shifting and conducted a workshop on transfer pricing in Liberia in February.
Member governments continue to work to implement our guidance on artisanal and small-scale mining (ASM). More than 40 government representatives from 17 African countries attended a February workshop in Cameroon on applying the ASM guidance to their national contexts.
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View this short video for more information about our local content policy guidance.
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UPDATED: Trade and investment sustainability toolkit
Our trade team recently updated an online toolkit to help policy-makers and negotiators craft trade and investment agreements that support sustainable development objectives. It shows how specific provisions might better serve those broad goals, citing over 200 text examples drawn from some 90 existing agreements. For a brief overview, please read Aaron Cosbey’s ITN article. The toolkit was developed in partnership with the UN Environment (UNEP).
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Low-carbon innovation for sustainable infrastructure
This report identifies the most promising parts of the procurement cycle to drive innovation and explains how they can best be utilized to support the transition toward a low-carbon economy in Europe.
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Explosive growth in artisanal and small-scale mining
A new IGF report finds that rising mineral prices and the struggle to earn a living from agriculture have led to explosive growth in ASM.
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Can agricultural growth poles solve rural poverty?
If done correctly, 'agropoles' could potentially avoid many of the negative impacts associated with the ill-designed deals that have become known as land grabs. This blog outlines what governments can do to help agropoles succeed.
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The influential amici in Philip Morris v. Uruguay
In a commentary, Dr. Benn McGrady of the World Health Organization discusses the role of amicus curiae briefs in investment treaty arbitration.
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