Recent developments in the international investment regime: Taking stock of phase 2 reform actions

In the face of new global investment and development challenges, policymakers need to devise public policies that are conducive to sustainable development and strengthen existing investment policy frameworks with this objective in mind. At the international level, sustainable development has entered the mainstream of international investment policymaking. As the reform of international investment agreements (IIAs) has made significant progress, it is time to take stock of IIA reform actions and chart the way forward.

International investment policymaking is in a dynamic phase, with far-reaching implications. This note provides an update on the 10 policy options of UNCTAD for phase 2 of IIA reform, originally launched in World Investment Report 2017. Countries can adapt and adopt these options to pursue reforms in line with their policy priorities. The UNCTAD policy options have spurred initial action to modernize old-generation treaties. Increasingly, countries are interpreting, amending, replacing or terminating outdated treaties.

While IIA reform is progressing, much remains to be done. The stock of old-generation treaties is 10 times greater than the number of modern, reform-oriented treaties, and investors continue to resort to old-generation treaties when bringing investor–State dispute settlement cases. IIA reform actions are also creating new challenges. Effectively harnessing international investment relations for the pursuit of sustainable development requires holistic and synchronized reform through an inclusive and transparent process. UNCTAD can play an important facilitating role in this regard.

Note by the Secretariat

Prepared for UNCTAD’s High-level IIA Conference 2019, as part of the Investment, Enterprise and Development Commission.