Better Rules for a Better Future: Regulating Private Sector Investments in ASEAN

1. Better Rules for a Better Future: Regulating
Private Sector Investments in ASEAN
8 August 2011<enter date>
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ASEAN as an attractive investment
destination
• Combined population of 620 million people
• Aggregate economy valued at of more than USD
2.3 trillion
• Average annual GDP growth of 6%
• ASEAN combined represent 7th
of the largest
economy in the world

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FDI Inflows in ASEAN
• In 2014, ASEAN is the largest FDI recipient in the developing world.
• FDI inflows into the country increased from USD 117.7 billion in
2013 to 136.2 billion in 2014.
• Two thirds of FDI inflows came from the EU, intra-ASEAN, Japan,
US, and Hong Kong (China)
• FDI in agriculture increased from USD 2.3 billion in 2013 to USD 4.5
billion in 2014
• Global FDI flows declined by 16% over the same period
Source: ASEAN Investment Report, 2015

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Two sides of private sector agricultural
investments…..

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Positive Side

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Negative Side

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Reports of displacement and land
conflicts
• Wilmar International (Singapore) Palm Oil Production in
Indonesia

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Food Insecurity

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Environmental degradation

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ASEAN Policies on Investment

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Some provisions of ACIA
• Greater investment liberalization, includes
covering many sectors such as agriculture
• Safeguards against expropriation and
nationalization of companies
• Unencumbered repatriation of investors’ capital
and earnings
• Prohibition of requiring nationals in management
and board
• Compensation of losses due to strife

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Do we need common/regional
policies to protect people’s rights
in the context of rising
investments?

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Yes!

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1. To promote good governance
everywhere and anywhere in
ASEAN

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2. To arrest race to the bottom and
promote upward harmonization of
good policies and practices

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3. To concretize sustainable,
caring and sharing community

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4. Because ASEAN can (difficult
but not impossible)
ASEAN charter
Balance respect for sovereignty of ASEAN
Member States with need to create ASEAN
community
ASEAN binding agreements and common
standards

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5. Because there is a need for it
There is a need to protect peoples and
communities’ rights, welfare and livelihood;
There is a need to safeguard food security;
There is a need to protect the environment;
There is a need to ensure economic and social
justice.

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What should be the component of
ASEAN policies on investments?

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Free, Prior and Informed Consent
of local communities that will be
affected by the project

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Policies promoting land rights and
food security

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Standards and regulations for
good contracts

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Regional standards for publicly
disclosed full impact assessment

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Mechanism for filing complaint
and seeking recourse

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How can this be done?
Regional
Policies on
PS Agri
Investments
Upward harmonization

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Thank you!