2018 Chapters (Layout Features)

Preface: Towards a Twenty-first Century Investment Agreement

Stiglitz, Joseph E.

Investment agreements have rightly come under attack in recent years. Many years ago, there was an attempt to arrive at a multilateral investment agreement, along the lines of the World Trade Organization (WTO) multilateral trade agreement. That effort failed. Because these agreements have taken on a central role in recent trade agreements, and because they have increasingly become a stumbling block, it is important to understand better both the politics and economics of these agreements. There are two underlying questions: what motivated the drive for these agreements? What was supposed to be protected? If investors were worried about nationalization (expropriation), in most cases, they could have bought insurance from the Multilateral Investment Guarantee Agency (MIGA), part of the World Bank Group, or from national authorities that offered similar protection. Besides, expropriations have been a rarity in recent decades. This suggests that something else drove the Investment Agenda. I will return to this question at the end. First, though, I want to describe what I believe a ‘good’ agreement might look like—something markedly different from what has appeared in recent trade and bilateral investment treaties.