As global trade continues to stagnate, the spotlight has shifted during China’s G20 Presidency to foreign direct investment (FDI).Two recent developments have brought FDI to the forefront of international policy deliberations. First, at their annual meeting in July 2016, G20 trade ministers endorsed nine G20 Guiding Principles for Global Investment Policymaking. Second, in June 2016 UNCTAD published its flagship annual World Investment Report showing that FDI flows “soared” in 2015 to its highest level since the onset of the global economic crisis. This report – released in advance of the G20 Leaders’ Summit in Hangzhou, China – critically evaluates the recovery of FDI, the G20’s contribution to that recovery, the coherence of G20 trade and investment policymaking to date, and ultimately, the new G20 Guiding Principles.
 
Drawing upon a 27% expansion in the Global Trade Alert’s sizeable database on commercial policy intervention, the latest data on corporate political risk, and information on global and investment flows, this report offers an evidence-based assessment of the rationale, content, and factors likely to determine the success of the G20’s new work programme on trade and investment policies.
 
The findings of this report will be of interest not just to observers of the G20, but to those interested in the drivers of FDI flows, the growing political risks created by greater resort to beggar-thy-neighbour activity, and the record of national trade and investment policymaking of the world’s largest economies.

Release date: 30 August 2016