The United Nations Council for Trade and Development (Unctad) has held a capacity-building workshop to help delegates from the least developed countries engage in best practices on efficient and transparent investment promotion.

Officials of investment promotion agencies from Ethiopia, Lesotho, the Maldives, Mali and Tanzania took part in the workshop, along with experts from Unctad, the United Nations Development Programme, the Organisation for Economic Co-operation & Development (OECD) and the private sector.

Putting clients first

All five countries have committed to developing a client-oriented and transparent administrative system that would encourage inward investment.

Mehmet Ogutcu, head of the Global Forum for International Investment at the OECD, said: “FDI has to be won. Those who wait for investors to come will probably wait in vain. Those who stick to fundamentals, realistically appraise their national FDI balance sheet, have the strategic intelligence to target the right investors, and have the promotion prowess to do so effectively and in a tailored way, will win.” Mr Ogutcu added that offering incentives to induce investors was only one method of FDI promotion and could not be relied on as much as a “professional management and service culture with a result-oriented ethos”.

Fundamentals versus incentives is a long-running debate in FDI, which, said Paul Laudicina, vice-president of US consultancy AT Kearney, is even more important in post-September 11 economics and geo-politics. “Incentives do not really matter,” said Mr Laudicina. “Political stability, good governance and infrastructure are more important.”

Government role

Mr Ogutcu cited a recent report by the Institute of Welsh Affairs, which said a clear government policy must be developed to fit into the national economic development framework. He emphasised that this must be a long-term vision or little will be achieved.

On the corporate side, Daniel de Feydeau, assistant general counsel at ABB, a Swiss-Swedish technology company, presented ABB’s policies on ethical standards within the company at the workshop. He emphasised how improvement in public governance should go hand in hand with improvements in corporate governance.

Unctad’s investment and training adviser, Paul Wessendorps, said the workshop was a success. He cited what representatives of the agencies thought were important in Unctad’s “good governance in investment promotion programme”. These included streamlining investment related procedures; greater partnerships between investment promotion agencies and the private sector; more transparency in investment promotion practices; and a heightened awareness of the need for good governance at the top of government.