The United Nations World Investment Forum (WIF) was established in 2008 based on a profound thought: to fill a systemic gap in global economic governance on investments. At the international level, economic governance has several pillars, including a multilateral monetary system headed by the IMF and a multilateral trading system by the World Trade Organization (WTO). 

But there is no equivalent for international investment policy. Thousands of bilateral and regional investment agreements govern the current de facto regime. In the absence of a multilateral system for cross-border investment, the WIF provides a global platform to gather policy-makers, the private sector and other key stakeholders for high-level discussion and action to shape international investment policy.

A soft normative approach

When we first launched the WIF, our idea was to create an alternative to the conventional approach to global investment policy-making — intergovernmental negotiations — by providing a platform for inclusive and comprehensive dialogue across the whole gamut of investment development stakeholders. That would lead to consensus on investment policies and norms in the global investment-development community. 

We took what I labelled “a soft normative approach” to global investment policy-making, which aims to formulate non-binding and flexible policy instruments with the best possible common denominators. They are meant to help guide the updating of national investment policies and international investment treaties, including through policy research, consensus-building and technical assistance. These policy instruments include frameworks, guiding principles, guidelines and voluntary codes of conduct.

We envisaged a virtuous cycle of policy-making, from proposals and policy options based on our policy research through multi-stakeholder deliberations and consensus building at WIF, to policy implementation in the field supported by our technical assistance, to feeding back lessons learned into further policy research and formulation.

Fifteen years on, and after eight iterations of the WIF, I can say this has proved a viable and pragmatic approach to shaping a new generation of international investment policy. As the WIF evolved, it broadened its scope to encompass the full spectrum of investment stakeholders, thereby integrating sustainable development into what I call the “investment value chain” with both upstream financing and downstream investment. This has proven paramount in amplifying development-oriented outcomes.

Changing times

Establishing the WIF proved prescient. The past decade and a half have seen sweeping changes in the global economy and our development paradigm, precipitated by devastating multiple global crises. The crises underscored the necessity for action-oriented dialogue between key stakeholders across the public and private sectors, including business and business associations, civil society, academia and international organisations.

In this regard, the WIF has seen several milestone achievements over the years. 

• WIF 2008 was held in Accra, where the conversation centred around the three-pronged global crisis: financial, food and fuel (the three Fs). The forum, in partnership with the World Association of Investment Promotion Agencies, formulated strategies for boosting global investment at the time of the crisis. 

• WIF 2010 was held in Xiamen, with the world seeing the first signs of recovery from the crisis. The forum engaged new players such as stock exchanges, sovereign wealth funds, pension funds and other institutional investors to put investment in sustainable development firmly on their agenda. The WIF hosted the first Global Dialogue of the UN Sustainable Stock Exchanges Initiative, whose membership has now grown to 122 stock exchanges worldwide with a combined market capitalisation of almost $125tn and more than 64,000 listed companies.

• WIF 2012 was held in parallel with the Unctad 13 Ministerial Conference in Doha. The forum launched the Investment Policy Framework for Sustainable Development (IPFSD) which has since underpinned the emergence of a new generation of investment policies and spearheaded a global drive to reform the international investment treaty regime: more than 150 countries and regional groupings have since used the IPFSD to modernise their national regulatory frameworks for investment and to reform their investment treaty networks. 

• WIF2014 was held in Geneva at a crucial time for the development community, as world leaders were in the process of formulating the Sustainable Development Goals (SDGs), which were adopted in 2015. With the first authoritative estimate for the SDG investment gap ($2.5tn annually in developing countries), we put forward the Action Plan for Investing in the SDGs, consisting of six sets of transformative actions to mobilise funds, channel them towards investment in sustainable development, and maximise positive impact.

• WIF 2016 was held in conjunction with the Unctad 14 Ministerial Conference in Nairobi. It gave impetus to development-oriented outcomes with the launch of the Global Action Menu for Investment Facilitation, which has since played an important role in shaping the global debate on an important slice of investment policy, including at the G20 and WTO. WIF 2016 also provided a timely global platform for formulating an implementation strategy for our Reform Package for the International Investment Regime, launched in 2015. In addition, we strengthened the focus on the downstream parts of the investment chain where impact is most visible, for example, through new policy guidance to boost entrepreneurship development, including women and youth. 

• WIF 2018 in Geneva saw the emergence of a realisation among policy-makers and business leaders that we are on the brink of a new era of globalisation, with new challenges and opportunities for countries to use investment for structural transformation, industrial diversification and sustainable development. Considering the investment-dependent industrial policies adopted by more than 100 countries since the start of the decade, the forum debated a framework for investment policy-making for a new generation of industrial development strategies. It also built on the theme of investing in the SDGs, launching a set of core indicators for SDG reporting by companies, a Policy Toolbox for Financing the SDGs, and an Entrepreneurship Policy Guide for Migrants and Refugees.

• WIF 2021 was held online on the theme ‘Investing in sustainable recovery’. During the forum, participants devised ways to make investment work better for sustainable development. As part of its key outcomes, the forum announced several important “global community-building” initiatives such as the World Investment for Development Alliance, which gathers all major international organisations with sizeable activities in investment for development; and the Global Alliance of Special Economic Zones, covering more than 7000 special economic zones in more than 140 countries. Together with partners from the development community, we also launched the UN Sustainable Finance Observatory initiative to promote and facilitate the transition of sustainable investment from market niche to market norm.

• WIF 2023 in Abu Dhabi was jam-packed with 157 insightful and impactful events. It was held in a context of cascading economic shocks worldwide, such as sharply rising living costs, unrelenting climate disasters, unbearable debt burdens, the aftermath of Covid-19, the impact of wars and challenging geopolitics, all tearing the fundamental fabric of our global society. With only 15% of the SDGs on target to be met by 2030, the SDG investment gap in the developing world is growing from $2.5tn dollars per year in 2015 to $4tn dollars in 2023. The forum addressed the key investment challenges caused by the multiple global crises. It included a focused track on promoting climate finance and investment, resulting in policy-makers and other key stakeholders devising solutions and reaching consensus on climate finance and investment priorities, with outcomes feeding into the COP28 negotiations. 

Looking ahead 

Looking ahead, as the WIF prepares for the future, I see three key challenges and opportunities for the global investment-development community that the forum will need to address. They are:

1. Changes in global economic governance. Fragmentation in international economic policy-making, and especially in trade and investment policy, including increasing regionalism and protectionism, geopolitical rivalry, and shifts in national economic policy-making from liberalisation to regulation and intervention.

2. Technological change and the new industrial revolution. Potentially far-reaching consequences for the configuration of global value chains with important implications for development, growth depending on investment in new sectors and the risk of premature de-industrialisation.

3. The sustainable development imperative. Climate change mitigation and adaption will affect global supply chains and the sustainability drive will affect the operations of multinationals and their suppliers, leading to new patterns of investment and different investment-development outcomes.

Together these developments will have profound consequences for the new era of global economy and structural transformation in the decade ahead, posing a series of challenges and opportunities for all stakeholders along the investment chain and for the investment-development community at large.

The WIF will continue its mission, that is, to provide a universal and inclusive global platform for investment stakeholders to effectively address key and emerging investment-development issues as well as formulating strategies to maximise the contribution of investment to sustainable development and prosperity for all. 

James X. Zhan is director of investment and enterprise at Unctad, lead of the World Investment Forum and member of fDi Intelligence’s Editorial Advisory Board. 

This article first appeared in the December 2023/January 2024 print edition of fDi Intelligence

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