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Investment Facilitation: How Far Do Public Policies Go?

By Federico Mazzella ,
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National and International Strategies to Facilitate Investment Flows.

The UNCTAD report Investment Facilitation: A Review of Policy Practices reveals that developing countries currently face very marked investment gaps. Despite this, international investment policies have been few and far between.

To address these shortfalls in investments, UNCTAD launched its Global Action Menu for Investment Facilitation (2016), based on its own experience with investment promotion and facilitation efforts and incorporating measures that promotion agencies believe to be key.

The study establishes, first, that investment facilitation is the set of policies and actions that seek to help investors expand their investments or carry out their day-to-day activities in different countries.

Second, the report reviews current practices and policies within national investment policies and international investment agreements (IIAs) and also includes a brief digression into the practical initiatives and tools available to support investment facilitation. These include:

-Specific action lines that form part of the Global Action Menu for Investment Facilitation.

-Reviewing how far some actions have already become part of current practices.

UNCTAD focuses on tackling “ground-level obstacles to investment” which can, for example, bring “improvements in transparency and information available to investors, […] work towards efficient administrative policies for investors, [and] enhance the predictability of the policy environment.”

Findings and Impacts

  • Since 2010, only around 20% of investment attraction measures focused on facilitation.
  • Conversely, 80% of these were about incentives, including special economic zones.
  • Less than a fifth of investment facilitation laws deal with specific aspects of investment facilitation such as one-stop shops, transparency, or conflict prevention.
  • Likewise, concrete provisions for investment facilitation are absent or weak in the more than 3300 IIAs currently in existence.
  • Online information sites and one-stop shops or single windows are vital tools for providing investors with information.

 

One key for attracting investment is improving the coherent application of standards and the efficiency of administrative procedures for investors.

In conclusion, concrete investment facilitation initiatives are relatively scarce in national investment policies. This is why the UNCTAD Global Action Menu for Investment Facilitation seeks to dismantle the systemic differences between the formulation of national and international investment policies and to encourage debate around concerted global action toward investment facilitation.

Facilitating investment is fundamental to achieving the Sustainable Development Goals, UNCTAD argues.

Investment Facilitation: A Review of Policy Practices. UNCTAD. 2017.

Key words: Investments, UNCTAD, legal framework, single windows, one-stop shops, information systems, normalization

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