Foreign Direct Investment and Human Development - FDI


The first thematic research will be conducted jointly by the CPDR (UCL), LICOS and the IIL (KULeuven).

Prof.   Olivier De Schutter - Coordinator of the thematic sub-network (CPDR - UCL)

Prof.   Johan Swinnen (LICOS - KULeuven)

Prof.   Jan Wouters (IIL - KULeuven)

Prof.   Miet Maertens (LICOS - KULeuven)

Mr   Philip De Man (IIL - KULeuven)

Ms   Liesbeth Colen (LICOS - KULeuven)

Mr   Nicolas Hachez (IIL - KULeuven)

Mr   Matthias Sant'Ana (CPDR - UCL)


The first thematic research isl conducted jointly by the CPDR (UCL), LICOS and the IIL (KULeuven). This research examines the impact on human development of the liberalization of private foreign direct investment (FDI), through the conclusion of international investment agreements (IIAs), whether under the form of bilateral investment treaties (BITs), regional trade agreements (RTAs) or multilateral treaties (WTO, GATS, TRIMS).

This thematic research builds on the existing scientific literature and policy recommendations made by intergovernmental bodies concerning the relationship of measures liberalizing foreign direct investment on human development in the receiving countries, especially developing countries.

Its general hypothesis is that, beyond helping these countries to negotiate investment agreements (or free trade agreements containing a clause on foreign investment) by providing them with the required technical expertise – (cfr work programme of the UNCTAD on international investment agreements (IIAs) –, it is necessary to create affirmatively the background conditions which will make it possible for these countries both to learn from past experiences and from other countries’ experiences, but also to reflect about which learning processes can be developed in order to constantly improve their capacity to channel FDI towards the aim of human development. Whichever learning processes are set up should be revisable on a systematic basis, in a recursive process which would place the institutional framework of such negotiations under constant scrutiny in the light of the new information arriving and the specific requirements of each context.

Our central question is: considering the different tools through which FDI flows may be encouraged and the available studies on the impact of FDI inflows on human development, which reforms should be brought to the regulation of FDI inflows in order to maximize the contribution of FDI liberalization to development? In seeking to address this question however, we draw on the hypothesis of reflexive governance, especially to the extent that this hypothesis leads us to inquire about the implicit presuppositions in the classical policy proposals currently available, and to ask how such presuppositions can be made explicit, and rather than being taken for granted, be affirmatively created. The most powerful of such presuppositions – but also the least addressed explicitly in the existing literature – concerns the capacity of the actors to actually benefit from a process set up in order to encourage collective learning. We insist not only on the need to extend the range of possibilities made available to the actors, but also on the need to address the question of how they can be made to aware of the need to develop devices encouraging learning and constant revision of their usual ways of framing the issues they address.

With this questions in mind we seek to :

- Offer a diagnosis on the opportunities and risks associated with the various tools seeking to encourage FDI. - A diversity of methodologies will be used including legal analysis, literature reviews, and empirical studies with a micro-economic dimension in order to examine firm-level effects of FDI as well as the local development impact of FDI, and open consultations with a variety of stakeholders.

- Put forward proposals which could ensure that such liberalization effectively contributes to the goals of human development centred on the realization of human rights.


Description of the research

Phase 1 - WP FDI 1 : Preparatory studies on the relationship between FDI and human development : Diagnosis on the opportunities and risks associated with the different tools for FDI : - This phase consists of a series of mapping studies on relationships between FDI & human development which will be submitted to external experts at two seminars. See working paper [FDI-HD-3]

1. Historical description of the growth of IIAs and of the different tools used to promote the liberalization of FDI (IIL-KUL)

2. Analysis of the shift in development discourse towards the concept of ‘human development' (CPDR-UCL)

3. Mapping of the existing studies on the relationship between FDI and human development (CPDR-UCL and LICOS-KUL)

4. Legal analysis of the provisions contained in international investment agreements (IIL-KUL)

5. The emerging customary law of international investment law (IIL-KUL)

6. The question of the level of negotiation of the liberalization of foreign direct investment (IIL-KUL)

7. The determinants of FDI inflows and the impact of IIAs in encouraging FDI (LICOS-KUL)

8. The nature of development encouraged by FDI inflows (LICOS-KUL)

Phase 2 - WP FDI 2 : Formulation of policy proposals

Second, policy proposals will be developed. These proposals will rely on the findings of the first phase, while complementing those findings wherever necessary. This will be done through six studies. These studies will also be submitted to external experts

1. Improving the monitoring of IIAs at national level (CPDR-UCL)

2. Improving the framework of international negotiations on IIAs (IIL-KUL)

3. Ensuring that IIAs work for human development (LICOS-KUL)

4. Ensuring accountability of non-State actors (transnational corporations) (CPDR-UCL)

5. Ensuring accountability of non-State actors (multilateral lending organizations) (IIL-KUL)

6. Ensuring accountability of national export credit agencies (CPDR-UCL)

Phase 3 - WP FDI 3 : Final report & presentation

Preparation of the final report on the policy proposals (CPDR-UCL, IIL-KUL, LICOS-KUL)

Presentation of the policy proposals at a conference (CPDR-UCL, IIL-KUL, LICOS-KUL)



Prof. Jacques Lenoble

Director - Coordinator

Université catholique de Louvain

Centre de Philosophie du Droit [ CPDR]







  • 26-28-29 April 2011 : "Philosophie du droit et enjeux de la gouvernance" by Prof. G.A. Legault (Sherbrooke University) - Louvain-La-Neuve

  • [Programme - Presentations]



Anne Liesse

Administrative Research Coordinator

Université catholique de Louvain

Centre de Philosophie du Droit [ CPDR ]

Place Montesquieu 2

B - 1348 Louvain-la-Neuve