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Development Account Projects

Strengthening the capacities of policymakers in developing countries and investment promotion officials in priority sectors to attract investment for sustainable and inclusive development

Background:

If they are to achieve the Millennium Development Goals and fulfil the vision set out in “The future we want”, developing countries, in particular least developed countries and other countries with weak and vulnerable economies, will have to boost investment and private sector participation in such sectors as infrastructure and public services. The latest UNCTAD data show that in 2011, international investment attraction declined for the third consecutive year in some of the world’s poorest regions, including Africa. Clearly, there is a greater need in these regions for assistance from the international community in building individual and institutional capacity to attract investment and ensuring that it contributes to sustainable and inclusive outcomes.

The project, therefore, is aimed at supporting government policymakers in identifying, designing and implementing effective investment policies that will increase the level of private sector investment in priority sectors identified in “The future we want” and will maximize the development contribution of investment. To maximize private sector investment, the project will place particular focus on private sector participation through public-private partnerships.

The project will draw on the deep and wide-ranging expertise of UNCTAD in capacity-building as well as on the substantive, research-based toolkit recently developed by the Conference, the Investment Policy Framework for Sustainable Development. The Framework distinguishes itself in several ways. Its approach is holistic (placing sustainable development at the core), systemic (addressing all dimensions of investment policy) and synergistic (fostering interaction with relevant national and international policies). Overall, it places particular emphasis on the relationship between foreign investment and sustainable development, advocating a balanced approach between the pursuit of purely economic growth objectives by means of investment liberalization and promotion, on the one hand, and the need to protect people and the environment, on the other.

The project will ensure that its policy recommendations and technical cooperation activities are in line with empirical findings and best practices in the area of international investment for sustainable development, especially with respect to public-private partnerships. The training and capacity-building of investment policymakers in developing countries will establish long-term, sustainable expertise in those countries in the areas of national and international investment policymaking, data collection and investment promotion and attraction that will boost the overall level of investment in sustainable and inclusive growth sectors of their economies, in line with the post-United Nations Conference on Sustainable Development agenda.

UNCTAD monitoring and evaluation has shown that support and capacity-building provided to developing country Governments and investment promotion agencies in the area of investment and enterprise development have led to the implementation of policy recommendations and increases in levels of investment. At the same time, UNCTAD research shows that even in cases where countries have been successful in attracting investment, positive development outcomes have not always been the result. This indicates that countries, especially those with the weakest institutional capacities, would benefit from training, capacity-building and policy support in the area of investment policies to maximize the impact of those policies on development outcomes. With a view to achieving this, the project is also aimed at involving long-time partners of UNCTAD, the World Association of Investment Promotion Agencies, the International Chamber of Commerce and the United Nations regional economic commissions, in order to engage the investment promotion community alongside policymakers and ensure that investment policy is coordinated and coherent at the country and regional levels.

Objective:

To increase the capacity of policymakers and investment promotion officials in four selected countries to formulate and implement policies that increase the contribution of international investment to sustainable development and inclusive growth in priority sectors

Expected accomplishments:

  • Increased understanding and awareness among policymakers and investment promotion officials in beneficiary countries of the role that international investment could play in sustainable and inclusive development
  • Increased capacity of government and investment promotion officials in beneficiary countries to collect, analyse and use investment data in order to be able to make and implement informed, evidence-based policy decisions that will boost investment in the areas of infrastructure and public services
  • Increased ability among policymakers in beneficiary countries to formulate and implement policies, including public-private partnerships, to attract international investment in such areas as infrastructure and public services

Implementation status:

In progress.