Investment Policies for SDG Sectors: Recent developments in the Special Issue of the Investment Policy Monitor

UNCTAD’s Investment Policy Monitor (Special Issue) on recent developments in investment policies for the SDG sectors has been released on 17 December 2020. The Monitor shows that in the reporting period from January to November 2020 the ongoing COVID-19 pandemic has accelerated the trend of introducing and strengthening policies for screening foreign investment for national security reasons. 58 percent of the policy measures in the reporting period fall into this category, and they particularly target the health sector. Six countries liberalized their foreign investment regimes in SDG sectors and eight provided for new instruments for investment promotion and facilitation in this area.

Countries may have good reasons for a more cautious approach towards foreign investment in individual SDG sectors. These include the need to ensure universal access to basic health services, the goal to prevent predatory acquisitions in the health sector and - more generally - concerns related to their national security.

Achieving the SDGs requires more investment. Existing investment promotion instruments applicable to the SDGs are limited in number and follow a piecemeal approach. UNCTAD’s global review of national investment policy regimes shows that less than half of UN Member States maintain specific promotion tools for investment in areas that are relevant to the SDGs (UNCTAD, WIR 2020, chapter V.D).

In view of the drastic decline in international private investment in SDG sectors since the outbreak of the pandemic - see UNCTAD’s SDG Investment Trends Monitor, December 2020 - more needs to be done to encourage and facilitate investment into SDG sectors. This includes development cooperation and financing support to developing countries. At the same time, investment policymaking needs to address legitimate concerns of countries related to the opening of sensitive SDG sectors to foreign investors and ensure that essential goods and services remain affordable and accessible for the poor and vulnerable.

The Special Issues of the UNCTAD’s Investment Policy Monitor is available here, while you can consult the newest SDG Investment Trends Monitor here.