Successfully Fostering Private Investment for Sustainable Development
By: Eva Hampl, USCIB
Earlier this month, the OECD hosted a day-long workshop in Paris entitled Making Investment Work for the Sustainable Development Goals, on the implementation of the Policy Framework for Investment (PFI). The OECD published a 2015 revision of this document, which was originally drafted in 2006, in response to a call for the importance of investment in the context of the Sustainable Development Goals (SDGs). The many business and government voices on the various panels of the PFI workshop included comments by Amb. Lisa Kubiske, U.S. Deputy Assistant Secretary of State for International Finance and Development, who spoke on coping with the challenges of implementation through partnerships, including collaboration between private and government actors, which is vital for the successful implementation of the PFI.
Representing U.S. business at the session, as part of a group of business representatives as part of the Business and Industry Advisory Committee (BIAC) to the OECD, I spoke on the importance of retaining a focus on core investment issues. USCIB agrees that investment is essential to realize the SDGs. Indeed domestic and international investment are vital for global economic growth and development. Investment, however, must be seen as more than the mere means to the end of the SDGs. To be able to fulfill its role as the creator of economic growth and development, we cannot forget what is required in order for investment to flourish.
The PFI puts in place a strong framework creating a supportive business environment devoid of protectionist measures. Such an open investment climate requires clear and well-implemented government policies; strong investment agreements providing essential protections for investors, including ISDS, market access, and core protections including fair, equitable and non-discriminatory treatment, protection against expropriation and “localization” requirements, and free transfers of capital and earnings. Instruments such as the OECD Declaration on International Investment and Multinational Enterprises also help in providing a level playing field essential for investment to flow.
The business community greatly supports the 2015 update of the PFI, and USCIB commends the OECD for leading this important effort and calls on the OECD to leverage its unique role in this process. However in implementing the PFI, it must be considered that while a comprehensive policy approach to investment is essential, the main objective of the PFI must remain to foster private investment. Only sound investment policy leads to economic and social development. USCIB will continue to actively participate in the implementation process of the PFI, the goal of which will be a leveling of the playing field by improving the investment environments in all countries willing and able to implement these ideals successfully.
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Eva Hampl is the Director for Investment, Trade Financial Services at the United States Council for International Business (USCIB), a leading industry association representing the views of American business around the world. USCIB serves as the American affiliate of the Business and Industry Advisory Committee (BIAC) to the OECD, the International Chamber of Commerce (ICC) and the International Organization of Employers (IOE). The views expressed in this blog post are those of the author.