Senior United Nations Secretariat officials, led by UN Secretary-General Kofi Annan, and a high-level business delegation from the International Chamber of Commerce (ICC) yesterday agreed to join forces in a move aimed at boosting investment flows into Africa and Least Developed Countries (LDCs). To that end, they called on UNCTAD, represented by Secretary-General Rubens Ricupero, to prepare a series of business investment guides for the LDCs with the cooperation of the ICC.
The decision to draw up the guides came at a meeting, held at UN headquarters in New York, to explore ways of stepping up dialogue and cooperation between the United Nations and business.
The guides, to be prepared upon request from the recipients, will contain information on investment opportunities and conditions in the countries covered. It was noted that UNCTAD has the technical capacity and requisite access to governments for compiling the guides and that business input through the ICC would ensure that the guides are relevant to business needs.
Integration of the LDCs into the global economy is a major challenge facing the international community. Improved trade and investment performance could have a significant impact over time in raising output and productivity.
The 48 countries identified by the United Nations as least developed, 33 of which are in Africa, currently attract merely 0.5 per cent of total foreign investment flows. In 1996, the LDCs as a group received US$ 1.6 billion of foreign direct investment (FDI) out of a world total of US$ 350 billion.
While many have introduced reforms to attract FDI, the lack of favourable policy frameworks, inadequate physical infrastructure and the absence of efficient support services remain formidable obstacles to linger from.
However, as shown in UNCTAD’s World Investment Report 1997, there is evidence of potentially profitable investment opportunities in LDCs. Many of them are not taken up simply because relevant information is not available to investors -- a serious shortcoming in the highly competitive world market for foreign investment.
The investment guides should help fill this gap and could become a catalyst for change, bringing together representatives of government with representatives of the local and international business communities, to seek ways and means in which the conditions for investment can be improved.
The LDC guides will be initiated in the near future with a pilot group of six countries. These countries have not yet been identified, but several countries have alread requested such a guide from the UNCTAD secretariat.
