Abstract
Fifty years ago, the role of foreign investors was at the center of the political debate, with host state - investors disputes showing a geographical North-Southth pattern. The end of the ISI model would signal a new era, including a new relationship with foreign investors. As part of their efforts, developing and emerging countries (DECs) liberalize foreign direct investment (FDI) national policies and to provide fiscal and other incentives to foreign investors. FDI flows were seen as always beneficial: a quantitative approach. Sooner than later, however, policy-makers became aware of the scheme’s pro-investment bias. FDI quality, not quantity, became the new ideal. Latin American countries’ position in the issue, however, remains quantitative objectives still dominate the investment debate. Indeed, a movement towards sustainability would come to question the natural-resource led growth model followed by the region. So, the debate around the treatment of foreign investors remains open.
Highlights
Developing and emerging countries (DECs) - foreign investors’ relationship experienced important and controversial twists
A multilateral agreement on foreign investment has become a long-standing effort, whose first attempt was made in the period immediately after World War II (WWII)
The second section turns attention to the multilateral fora, asking why an international agreement on investment facilitation could be approved and whether it remains favorable for the developing and emerging countries (DECs) long-term sustainable development
Summary
Developing and emerging countries (DECs) - foreign investors’ relationship experienced important and controversial twists. The resulting emerging global legal framework rests on the twin foundations of customary international law and national laws and regulations. From being fiercely opposed to regulating capital inflows (including FDI flows) to suddenly start advocating for more screening and control over foreign investors? The second section turns attention to the multilateral fora, asking why an international agreement on investment facilitation could be approved and whether it remains favorable for the DECs long-term sustainable development. Host countries embraced neoliberalism in the nineties, including new (pro-investor) legal rules and the establishment of new offices (agencies) directed to seduce foreign investors to (and helping them after) arrival. The rules versus discretion debate help us to understand the legal discussion; the informational bias would be introduced to delineate the agency issue
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