The UN Conference on Trade And Development (UNCTAD) is increasingly used by OECD countries and business groupings as a forum for moving Third World countries in the direction of a friendlier position on investment deregulation.
At its May 1996 conference in Witrand, South Africa, UNCTAD received a mandate to study the development implications of existing investment arrangements like bilateral investment treaties (BITs) and to discuss the necessity of a multilateral framework for investment.
In the final conclusions of their June 1996 meeting in Lyon, G-7 leaders described the results of the Witrand Conference as "a major milestone in the renewal of UNCTAD" and applauded the refocusing of UNCTAD's work on "a small number of priorities to promote development through trade and investment with the aim of facilitating the integration of developing countries in the international trade system."
Although consensus building on investment rules within UNCTAD is informal, developing countries didn't join without nudges from their industrialized neighbours. As EU Commissioner Sir Leon Brittan put it in a speech to a business audience in Cologne, "Informal discussions have already begun in Geneva, largely thanks to European and Canadian pressure. We have been trying not to bludgeon developing countries into submission, but to share with them the fruits of our latest analysis, in order to show that investment liberalization is a winning strategy for all players."
And not only G-7 governments are trying to lure developing countries into the UNCTAD massage parlour -- major industry lobby groups like the European Roundtable of Industrialists (ERT) and the International Chamber of Commerce (ICC) have also discovered the usefulness of this institution.
In December of 1997, the ERT and the UNCTAD secretariat co-organized a high-level meeting of 25 Geneva-based ambassadors from developing countries and some 16 CEOs of ERT companies to discuss a June 1997 ERT working paper on investment. The meeting was chaired by UNCTAD Secretary General Rubens Ricupero and ICC and ERT Chairman Helmut Maucher of Nestlé. Maria Livanos Cattaui, Secretary General of the ICC, was also present.
And at UNCTAD's 1996 World Investment Forum conference, the ICC spoke on behalf of world business, outlining what Third World countries should do to attract foreign direct investment. Asking investors to fulfil special obligations, for example, was strongly discouraged.
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