Improving access to Foreign Direct Investment for Pacific Island Countries: Pursuit of International Investment Agreements from a development perspective

With aims of economic development and its associated benefits, most countries have established networks of treaties, inclusively termed International Investment Agreements (IIAs), which liberalise, promote, protect and regulate investment flows between the parties. The average number of Bilateral Investment Treaties concluded and in force per country is around 11. Except for Papua New Guinea, the Pacific Island States each have 1 (three of 16 included States) or no IIAs in force – limiting access and control over incoming international investment in their economies. This paper analyses the potential of IIAs in promoting Foreign Direct Investment (FDI), economic development and its associated benefits in Pacific island nations. It examines the existing IIAs reached by Pacific island countries and compares them with IIAs in place in other Small Island Developing States outside the Pacific. Finally, it explores the best practices for the design of a model IIA which might be suited to the investment and development policies, and particular economic conditions of Pacific island states, with the explicit aim of enhancing the contributions to the development outcomes of those economies. This research uses treaty analysis alongside social and political science approaches to development and economic data. Key legal sources include identified treaties and their mapping data from the UNCTAD database, economic data, arbitral proceedings and awards, and public policy statements on foreign investment from Pacific island countries. It will assume underlying principles of sovereign self-determination and pursuit of the Sustainable Development Goals. Included economies: Cook Islands; Fiji; Kiribati; Micronesia, Federated States of; Marshall Islands; Nauru; Niue; Palau; Papua New Guinea; Samoa; Solomon Islands; Timor; Tonga; Tuvalu; Vanuatu