Table of Contents

International Investment Law and Development

International Investment Law and Development

Bridging the Gap

Frankfurt Investment and Economic Law series

Edited by Stephan W. Schill, Christian J. Tams and Rainer Hofmann

Foreign investment is meant to contribute to the host country’s development, and yet international investment law has often been seen as an obstacle to (sustainable) development. So are investment and development friends or foes? Combining critical reflection and detailed analysis, this timely volume explores the relationship between the two concepts and explores options of harnessing investment for development.

Chapter 12: The international mandate for development: Building compliant investment within the state’s development decision-making processes

Diane A. Desierto

Subjects: development studies, law and development, law - academic, international economic law, trade law, international investment law, law and development

Extract

Is investment separable from development? Discourses about the legal regimes governing development and investment often approach both concepts either from a historiographical trajectory leading towards some convergence, from descriptions of an ongoing polar divide illustrated by certain investor-State arbitral awards, or from the incipient efforts to rewrite international investment agreements towards a ‘rebalancing’ interests that guarantee policy space for governments to pursue development targets through the design of legislation and administrative regulations. These approaches presuppose some incompatibility, conceptual ambiguity, competing rival ideologies, or teleological disharmony when States plan and operationalize international investment transactions and projects as part of their national development goals and strategies. Indeed, discursive positions on this question often oscillate within the binary of ‘defenders’ and ‘abolitionists’ of international investment law – between those who stress the essential importance of foreign investment for achieving economic growth and the State’s overall development, and those who argue that the international investment legal system is devoid of any possibilities for reform because of inherent defects creating prohibitive obstacles for the State against feasibly accomplishing development objectives. As with any complex question traversing law and authoritative decision-making (and which requires one to engage various intellectual disciplines and analytical tools examining social phenomena), however, the question of the actual nature of the relationship between the legal regimes governing investment and development will not always yield a linear answer in all cases.

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