Deputy Secretary-General Calls for Investment Agreements that Support Sustainable Growth
28 April 2005
An investment agreement that supports sustainable growth will benefit developing countries, particularly the least developed countries (LDCs) and small states.
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| Commonwealth Deputy Secretary-General Florence Mugasha at Marlborough House, 28 April 2005 |
Mrs Mugasha said a fair investment agreement should protect the rights and obligations of the investor as well as the host country. She noted that investment flows into developing, small and vulnerable Commonwealth countries have been influenced by geographical limitations, including size, remoteness or being landlocked or environmentally vulnerable. The large debt overhang has also constrained the investment prospects in these countries.
In response to these challenges, she said the Commonwealth Private Investment Initiative was launched in 1995 to promote portfolio investment funds in Africa, the Caribbean, the Pacific and South Asia, that focuses on small and medium-sized private projects. The Deputy Secretary-General stated that in 2001, the Commonwealth Secretariat commissioned a study to examine the needs of LDCs and small vulnerable economies in attracting and retaining private direct investment in the face of increasing globalisation and the erosion of preferential trade arrangements.
Aaron Cosbey, IISD Associate and Senior Adviser, who also spoke at the meeting, said investments should have a positive spill-over effect that addresses poverty alleviation and environmental sustainability. Randall Williams, Trade Lawyer at South Africa's Department of Trade and Industry, said investment protection schemes are important for bilateral investment agreements that should support the economic growth policies of the host country.
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