OECD Ministers launch new framework to boost sustainable investment
4/6/2015 - The updated Policy Framework for Investment (PFI) was released at the 2015 OECD Ministerial Council Meeting in Paris.
The long-term investment challenge, Angel Gurría
Financing for development? Show me the money, Gabriela Ramos
Regional investment: Time to cooperate, Carole Biau
About the Policy Framework for Investment
The Policy Framework for Investment (PFI) is the most comprehensive and systematic approach for improving investment conditions ever developed. In response to new forces reshaping the global investment landscape and the numerous lessons learnt through its use over the years, the PFI has been updated to reflect new global economic fundamentals and to incorporate feedback from the international investment policy community.
The PFI looks at 12 different policy areas affecting investment: investment policy, investment promotion and facilitation, competition, trade, taxation, corporate governance, finance, infrastructure, developing human resources, policies to promote responsible business conduct and investment in support of green growth, and lastly broader issues of public governance. These policy areas are widely recognised, including in the Monterrey Consensus, as underpinning a healthy environment for all investors, from small- and medium-sized firms to multinational enterprises. But while the PFI looks at policies from an investor perspective, its aim is to maximise the broader development impact from investment and not simply to raise corporate profitability.
The PFI is neither prescriptive nor binding. It emphasises the fundamental principles of rule of law, transparency, non-discrimination and the protection of property rights but leaves for the country concerned the choice of policies, based on its economic circumstances and institutional capabilities. It helps governments to design and implement policy reforms to create a truly attractive, robust and competitive environment for domestic and foreign investment.
Although addressed to governments, the PFI needs to be seen in the broader context of other converging international initiatives to improve the investment climate, including the OECD Guidelines for Multinational Enterprises.
Who uses the PFI?
With its broad horizontal approach, the PFI assists governments engaged in domestic reform, regional co-operation or international policy dialogue on investment. It also serves as a reference point for investment promotion agencies, donors as they assist recipient country partners in improving the investment climate, and businesses, trade unions, and NGOs in their dialogue with governments.
In the context of OECD Investment Policy Reviews (IPRs), the PFI has been used by close to 30 countries at varying levels of development and across all continents, as a tool for assessing investment and business climates, and for designing reforms to improve them.
The PFI also provides a basis for support on regional investment policy dialogue. Established regional economic communities are currently using the PFI to promote peer learning on regional investment policy and policy harmonisation among their members. Examples include the NEPAD-OECD Africa Investment Initiative, the ASEAN-OECD Investment Programme. the Latin America and Caribbean Investment Initiative , the Investment Compact for Southeast Europe and the Middle East and North Africa investment programme.
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