BackIndia, South Africa, US oppose G20 draft on investment facilitation
India and South Africa say they do not see any merit for an outcome on investment facilitation because it would undermine their 'policy space'
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Geneva: The US, India and South Africa have pulled the plug on a draft deliverable on investment facilitation proposed by the German presidency at a G20 technical experts meeting in Berlin, according to people familiar with the development.
The US which had already taken a strong position on investment facilitation said it is not in position to agree to the issue. India and South Africa said they do not see any merit for an outcome on investment facilitation because it would undermine their “policy space" and “right to regulate investment" in strategic sectors.
Although they participated in the discussions and introduced several caveats in the draft, India and South Africa insisted that the chair of the G20 TIWG (trade and investment working group) issue some broad messages but not an outcome, according to a participant, who did not wish to be named.
The collapse of the discussions is a major setback to China, Japan, Russia, and Brazil who want to discuss the issue at the World Trade Organization, said a participant who asked not to be named.
Germany, which is hosting a G20 leaders meeting in Hamburg on 7 July, convened the TIWG meeting last week to finalize three deliverables—a draft package on investment facilitation; strengthening trade monitoring and trade measures for checking protectionism; and measures for providing trade assistance.
The three-day meeting which began in Berlin on 4 May was abruptly terminated on Friday after the US on the one side, and India and South Africa on the other, opposed the German draft package on investment facilitation.
Several countries such as Japan, China, Russia, Canada, Brazil, and Australia supported the German draft during the discussions. It sought to reaffirm “the Principles for Global Investment Policy Making endorsed in the Hangzhou communiqué (in September, 2016) and encourage policymakers to use them as reference and guidance."
It maintained that investment plays an important role for promoting inclusive economic growth and sustainable development through the creation of jobs and dissemination of skills and technology. Therefore, G20 leaders must agree on the package of investment facilitation measures to ensure that they are “transparent, efficient, predictable and consistent - also with international obligations," the draft suggested.
The non-binding G20 investment facilitation package includes objectives such as reaffirming and complementing the G20 guiding principles for global investment policy making; fostering open and transparent business climates that are conducive to investment; promoting inclusive economic growth, sustainable development; and a level-playing field for all investors, including SMEs.
It listed four actions by G20 countries—transparency, predictability and consistency (in investment policies), efficiency, and stakeholder relations.
However, the setback to agree on the German draft is bound to undermine efforts by China, Russia, Brazil, Argentina, and a group of countries called MIKTA-Mexico, Indonesia, South Korea, Turkey, and Australia—to discuss investment facilitation at the WTO on Wednesday .
The US also opposed the proposed deliverables on trade monitoring and measures for resisting protectionism and trade assistance, issues on which India and South Africa did not have reservations.
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