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Foreign Direct Investment

Volume 409: debated on Friday 18 July 2003

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To ask the Minister of State, Department for International Development what steps the Government plans to take to encourage the flow of foreign direct investment to the poorest nations of the developing world; and what international mechanism the Government supports to facilitate this. [126239]

The Government believe that, alongside domestic private investment, more quality, productive foreign direct investment is essential for growth and poverty reduction in developing countries. DFID supports a wide range of international efforts directed at improving the overall investment climate for such investment. These include support for: Comprehensive Investment Climate Assessments by the World Bank Group and the Commonwealth Business Council, which help to identify investment obstacles in particular countries; research by the Organisation of Economic Co-operation and Development (OECD) and NGOs on the benefits and costs of foreign direct investment; and the UN Conference on Trade and Development (UNCTAD) programme of technical assistance, which helps developing countries build their capacity to better understand, attract and regulate foreign investment. The Government also believe that an international investment agreement negotiated in the World Trade Organisation (WTO) could complement these and other initiatives aimed at facilitating foreign investment flows to developing countries.