Strengthening the development impact of UNCTAD's investment policy reviews

Abstract

"1. IPRs can be a very useful instrument for making FDI policy more effective for the development process. 2. IPRs should not focus exclusively on foreign direct investment but rather on investment in general and consider FDI as one of several elements in the development process. 3. UNCTAD should, in accord with donor countries, take a greater say in the selection of the countries reviewed. The starting point should be an analysis of the absorption capacity and the need for external assistance in the countries in question. 4. In view of widely differing domestic capacities and different needs for and institutional policy advice, UNCTAD should undertake more efforts to adapt the volume of issues covered to the advice actually needed. Activities could extend from Quick Response Window action on one or few specific problems to an "IPR light" or a full-fledged IPR. 5. Recommendations should be based more on investors' and non-investors' experiences and assessments than on a formal investment framework. Assessment of the impact and definition of investment opportunities should be more cautious, given the complexity of these issues. 6. Much weight should be given (1) to the coherence of the various policy actions and (2) to compatibility of national FDI policy and obligations resulting from international treaties. 7. Recommendations regarding policy measures should often be more precise. 8. Support should be given to UNCTAD policy with a view to making use of the knowledge and resources available in other programs. Co-ordination with other institutions (World Bank, OECD, UNDP, etc.) should be intensified. However, this should focus on exchange of facts - competition should continue as far as the provision of advices concerned. 9. Involvement of stakeholders from government, business, and civil society can contribute to better acceptance of an IPR. Top-level government support likewise serves to improve the chances that recommendations will in fact be implemented. UNCTAD's policy in this respect should be continued as long as recommendations are not diluted and become featureless. 10. Implementation of recommendations should be promoted by integrating IPR activities more into 'normal' development assistance. A certain share of the IPR budget should be reserved for implementation action, such as meetings, certain consulting activities, and development of domestic human resources. We consider a 30% share appropriate." (excerpt)