Chapter 20 Reform of international investment agreements and sustainable development: contrasting the EU and Global South approaches
Open access

The UN 2030 Agenda for Sustainable Development prominently supports that foreign investment and sustainable development are closely linked allies that mutually reinforce each other. While the term “sustainable development” has first been defined in the 1987 “Brundtland Report”, the UN 2030 Agenda is the most recent step to formulate various strategies to harmonize the three dimensions of sustainable development, namely economic growth, social inclusion, and environmental protection to eradicate poverty in all its forms. For the EU, the 2007 Lisbon Treaty establishes “sustainable economic, social and environmental development of developing countries“ as a foreign policy goal that the EU must consider when regulating external trade and investment. Both the European Commission’s Trade for All Strategy and its Reflection Paper on Harnessing Globalization have developed strategies to implement this goal. All Trade and Investment Agreements (TIAs) concluded since Lisbon contain “Trade and Sustainable Development” (TSD) chapters to ensure that the economic relations between the EU and its partners do not impede the implementation of sustainable development. However, despite the constant attempts to reconcile trade, investment, and sustainable development, it remains questionable whether and to what extent these EU foreign policy instruments contribute to realizing sustainable development.

  • Bartels, L. (2013) Human Rights and Sustainable Development Obligations in EU Free Trade Agreements. Legal Issues of Economic Integration, 40, 297–314.

  • Dolzer, R. and Schreuer, C. (2012) Principles of International Investment Law, 2nd edition. Oxford: Oxford University Press.

  • European Commission (2015) Investment in TTIP and Beyond – the Path for Reform. http://trade.ec.europa.eu/doclib/docs/2015/may/tradoc_153408.PDF.

  • European Commission (2018) Feedback and Way Forward on Improving the Implementation and Enforcement of Trade and Sustainable Development Chapters in EU FTAs. http://trade.ec.europa.eu/doclib/docs/2018/february/tradoc_156618.pdf.

  • European Parliament (2020) Multilateral Investment Court, Overview of the Reform Proposals and Prospects. Briefing. https://www.europarl.europa.eu/RegData/etudes/BRIE/2020/646147/EPRS_BRI(2020)646147_EN.pdf.

  • ICSID (2022) The ICSID Case-Load – Statistics (Issue 2022-2). https://icsid.worldbank.org/sites/default/files/publications/The_ICSID_Caseload_Statistics_2022-2_ENG.pdf.

  • IISD (2005) Model International Agreement on Investment for Sustainable Development. https://www.iisd.org/system/files/publications/investment_model_int_agreement.pdf.

  • Mann, H. (2013) Reconceptualizing International Investment Law: Its Role in Sustainable Development. Lewis & Clark Law Review, 17, 521–544.

  • Mbengue, M. and Schacherer, S. (2017) The “Africanization” of International Investment Law: The Pan-African Investment Code and the Reform of the International Investment Regime. Journal of World Investment & Trade, 18, 414–448.

  • Muniz, J., Duggal, K. A. N. and Peretti, L. A. S. (2017) The New Brazilian BIT on Cooperation and Facilitation of Investments: A New Approach in Times of Change. ICSID Review – Foreign Investment Law Journal, 32, 404–417.

  • National Board of Trade Sweden (NBTS) (ed.) (2019) TSD Handbook, Implementation of the Chapter on Trade and Sustainable Development in the Trade Agreement between EU and Ecuador. https://www.kommerskollegium.se/globalassets/publikationer/guider/2019/handbook-tsd-en.pdf.

  • Nowrot, K. (2015) Obligations of Investors. In Bungenberg, M., Griebel, J., Hobe, S. and Reinisch, A. (eds.), International Investment Law. Baden Baden: Nomos, 1154–1185.

  • Salacuse, J. (2021) The Law of Investment Treaties, 3rd edition. Oxford: Oxford University Press.

  • Sardinha, E. (2017) The New EU-Led Approach to Investor-State Arbitration: The Investment Tribunal System in the Comprehensive Economic Trade Agreement (CETA) and the EU-Vietnam Free Trade Agreement. ICSID Review – Foreign Investment Law Journal, 32, 625–672.

  • Tams, C. (2014) Procedural Aspects of Investor-State Dispute Settlement: The Emergence of an European Approach? Journal of World Investment & Trade, 15, 585–611.

  • Traidcraft (ed.) (2015) International Investment Agreements under Scrutiny: Bilateral Investment Treaties, EU Investment Policy and International Development. https://www.tni.org/files/download/iias_report_feb_2015.pdf.

  • UNCITRAL (2019) Possible Reforms of ISDS, A/CN.9/WG.III/WP.166 and Addendum A/CN.9/WG.III/WP.166. Add.1.

  • UNCTAD (ed.) (2012) Expropriation. New York: United Nations.

  • UNCTAD (2018) UNCTAD’s Reform Package for the International Investment Regime. https://investmentpolicy.unctad.org/publications/1190/unctad-s-reform-package-for-the-international-investment-regime-2018-edition-.

  • Zagel, G. (2020a) Achieving Sustainable Development Objectives in International Investment Law. In Chaisse, J., ‎ Choukroune, ‎L. and Jusoh, S. (eds), Handbook of International Investment Law and Policy. Singapore: Springer, 1–55.

  • Zagel, G. (2020b) India’s International Investment Agreements (IIAs) and Sustainable Development: Friends or Foes? Indian Journal of International Economic Law, 12, 1–39.