Advancing sustainable development with FDI

Click the image below to watch the full discussion:

The Hinrich Foundation is delighted to have hosted a discussion on June 29 on restoring the transformative power of foreign direct investment (FDI) in the face of declining investment inflows exacerbated by the Covid-19 pandemic. Featuring speakers from the trade research community, the discussion centered around Advancing sustainable development with FDI: Why policy must be reset, the latest report from Simon Evenett and Johannes Fritz of Global Trade Alert.

Foreign direct investment (FDI) is key to transforming the prospects of economies. It creates jobs, boosts productivity, and brings management expertise as well as technology to developing countries that need such investments to deliver growth and sustainable development. In many instances, FDI outperforms aid, remittances, and portfolio investments as the largest source of external funding. However, there has been a growing mismatch in government expectation and action when it comes to FDI. More is demanded from FDI but heightened regulatory measures make life difficult for international businesses. The frictions have contributed to reduced FDI inflows.

The webinar explored the critical issue of declining FDI and asked: Why are returns on FDI so low in developing countries and what can be done to reverse this trend? How can existing regulatory policies and enforcement practices be adjusted to de-risk FDI? And what can international business realistically deliver to support mitigation of climate change and advance sustainable development?

These questions and other important issues were discussed by the discussants, which included:

• Simon J. Evenett, Professor of International Trade and Economic Development and MBA Director, University of St. Gallen
• Eduardo Pedrosa, Secretary General, Pacific Economic Cooperation Council
• Robert Scollay, Associate Professor, Economics at the University of Auckland

The session was moderated by Intan Ramli, Policy Fellow at the Economic Research Institute for ASEAN and East Asia (ERIA).

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