At a time of persistent crises and pressing social and environmental challenges, harnessing economic growth for sustainable and inclusive development is more important than ever. Investment is a primary driver of such growth. Mobilizing it and ensuring that it contributes to sustainable development objectives is important for all countries, especially developing countries.
Against this background, a new generation of investment policies is emerging, pursuing a broader and more intricate development policy agenda, while building or maintaining a generally favourable investment climate. New-generation investment policies place inclusive growth and sustainable development at the heart of efforts to attract and benefit from investment by pursuing the following goals:
- To create synergies with wider economic development aims or industrial policies, and achieve seamless integration in development strategies.
- To foster responsible investor behaviour and incorporate principles of corporate social responsibility.
- To ensure policy effectiveness in the design, implementation and institutional environment within which investment policies operate.
To help meet these challenges, UNCTAD has taken a fresh look at investment policymaking. It has taken a systemic approach, examining national and international policies through the lens of today's key investment issues and has focused particularly on the development dimension. This has resulted in the establishment of a comprehensive tool, the Investment Policy Framework for Sustainable Development (IPFSD).
Developed in parallel with UNCTAD's Entrepreneurship Policy Framework and Implementation Guidance, IPFSD consists of a set of core principles for investment policymaking, which set out the design criteria for investment policies. It contains guidelines for national investment policies, offering suggestions on how to ensure the integration of investment policy with development strategy, how to ensure policy coherence and design investment policies in support of sustainable development and how to improve policy effectiveness. Lastly, it offers guidance for policymakers in the form of options for the design and use of international investment agreements, which form the first comprehensive overview of the many options available in this respect.
PFSD is not a negotiated text or an undertaking between States. It is an initiative by the UNCTAD secretariat that leaves it up to national policymakers to adapt and adopt as they see fit. It may serve as a reference for formulating national investment policies and in negotiating investment agreements or revising existing ones. It may also provide policy guidance in areas as diverse as trade, competition, industrial policy, environmental and social policies, or any other policy area where investment plays an important role. It can also serve as a basis for capacity-building on investment policy and for UNCTAD's technical assistance work. In addition, it may come to act as a point of convergence for international cooperation on investment issues.
IPFSD has been designed as a living document. It provides common language for debate and cooperation on national and international investment policies. Further, UNCTAD's newly established IPFSD online constitutes an interactive open-source platform that invites the international community to exchange views, suggestions and experiences on the Framework.