123 members of the World Trade Organization (WTO) have achieved a landmark with the conclusion of the Investment Facilitation for Development (IFD) Agreement. This declaration, made on February 25, precedes the 13th WTO Ministerial Conference in Abu Dhabi, illustrating a concerted effort to bolster global economic resilience and inclusivity. The IFD Agreement champions foreign direct investment (FDI) as a vital engine for growth, productivity enhancement, job creation, and deeper integration into global supply chains.
WTO Director-General Ngozi Okonjo-Iweala praised this groundbreaking initiative, emphasizing its role in transforming the global investment landscape. The initiative, led by Claudia Sanhueza, Vice-Minister of Trade of Chile, and Inkyo Cheong, Minister of Trade of the Republic of Korea, stands as a testament to the WTO’s capability to navigate through contemporary economic tribulations towards sustainable growth.
The essence of the IFD Agreement lies in its commitment to establishing a stable and transparent investment framework, strategically excluding directives on market access, investment protection, and investor-state dispute resolution. Its primary focus remains on fostering an attractive climate for FDI, especially beneficial for developing and least-developed countries (LDCs).
A pivotal aspect of this agreement is its proposition for inclusion into Annex 4 of the Marrakesh Agreement Establishing the WTO as a plurilateral agreement, thereby extending an invitation to all WTO members to participate. This inclusion is crucial for leveraging the agreement’s full potential, particularly for nations most in need of sustainable investment flows. Moreover, it guarantees technical assistance and capacity-building support for its enactment in developing countries and LDCs.
Initiated in September 2020, following over three years of foundational efforts, the IFD Agreement’s journey to fruition reflects the WTO’s commitment to crafting a global framework that promotes investment facilitation for development through a lens of openness, transparency, and inclusivity.
As discussions to incorporate the IFD Agreement into the WTO’s foundational texts take center stage at the 13th Ministerial Conference, the global trading community stands on the cusp of a new chapter. This integration aims to catalyze a new era of international collaboration and bolster support for investment facilitation efforts across the globe.
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