Negotiations at the World Trade Organization (WTO) increasingly affect cross-border investment, as many current trade issues have an investment dimension. In consequence, the European Commission has included investment in its proposed list of agenda items for a comprehensive “Millennium Round”.
One-third of all foreign direct investment is now hosted by developing economies, and it is here that the lack of consistent international rules constitutes a significant element of business risk. The interest of these countries in the regulation of investment to ensure sustainable development and their need to access international capital markets without having to lower standards mean that agreed multilateral rules would be to their advantage.