The importance of national policy space

The preceding analysis revealed that IIAs need to accommodate different perspectives on the policy priorities in the investment process. The common goal, shared by all parties to IIAs, is to increase the flows of FDI. In addition, home countries (and their investors) seek transparency, stability, predictability and security—and greater market access. And host developing countries, for their part, want to advance their development by increasing the benefits from FDI. To do so, they need to have enough flexibility to use a range of development-oriented policies. In the final analysis, IIAs have to be acceptable to all parties, many in different development situations with widely differing endowments. IIAs therefore need to strike a mutually advantageous balance of rights and obligations between the diverging interests and priorities of various groups of countries.

Sustainable Development Goals:

Decent Work and Economic Growth