This article explores the international right of development, as expressed in the design of new trade-based international investment agreements (IIAs). I show that, hitherto, development has figured mostly in investment arbitration primarily through the question of jurisdictional gate keeping – and how to reconcile the meaning of investment within Article 25 of the ICSID Convention with the effect of pro-development language in the Preamble to the ICSID Convention. While the Salini test will remain a much-debated approach in international investment interpretation, the main subjective difficulty in elevating development into a condition or criterion for investment treaty coverage is that the international right of development is itself a dynamic concept, with equally divergent methods for assessing “contributions to economic development”. The inherent fluidity of the concept of development, coupled with the absence of any language within Article 25 of the ICSID on the international right to development, further supports the view that the Convention did not intend to impose development contributions as a strict condition or mandatory criterion before gaining access to ICSID jurisdiction. Rather than focus on the problematic uses of the international right of development in jurisdictional gate keeping, I draw attention to the actual nature of the international right to development and its implementation, which has less to do with justiciability (or adjudicated remedies), than the direct implementation and supervision of States. The practicable development-oriented innovations in new trade-based IIAs (such as the COMESA Common Investment Agreement, the ASEAN Comprehensive Investment Agreement, and the ASEAN-China Investment Agreement) appears to align more closely with the actual nature of the right to development. These particular types of IIAs, which often form part of a complete trade cooperation package, operationalize the international right of development through: 1) permissible differentiation or graduated implementation of host State obligations, taking the host State’s stage of economic development into account; 2) transparency obligations and information exchanges between treaty partners; 3) joint investment promotion activities by treaty partners; and 4) coordinated institutional mechanisms that enable host State participation and access in monitoring treaty interpretation and any investment-related rule making. These phenomena demonstrate a marked paradigm shift towards more effective deployment of the international right of development in international investment rule-making.
Thursday, September 15, 2011
Desierto: Development as an International Right: Investment in the New Trade-Based IIAs
Diane Alferez Desierto (Yale Univ. - Law) has posted Development as an International Right: Investment in the New Trade-Based IIAs (Trade, Law & Development, forthcoming). Here's the abstract: