A Portal to support host countries in their planning, preparation for, negotiation, monitoring, and implementation of complex investment projects
From time to time, countries enter into large-scale investment contracts with foreign investors. The most important and complex of these are related to natural resources (mining, oil and gas, and commercial agriculture) and infrastructure projects. Such investment projects can last for decades and are, for many countries, an important means of generating funds to drive economic growth and development, or for providing an essential public service in the case of infrastructure. Yet, despite their critical importance, many host country governments lack a strategic vision, strong regulatory frameworks, or the necessary resources to plan, prepare for, negotiate, monitor, and implement such projects, limiting their ability to maximize the benefits for their country. In addition, from the company’s perspective, imbalanced deals can lead to adverse business outcomes, linked to reduced security of titles or concessions, increased prospects for disrupted operations from civil protests and greater risks of revisions of tax and other conditions.
The Columbia Center on Sustainable Investment (CCSI) works with governments, support providers who assist governments, donors, civil society, and other partners to explore ways to more effectively support low-income, resource-rich countries in their negotiations of large-scale investment projects. One gap regularly identified is the lack of awareness of the tools and resources available to governments, and a general lack of knowledge-sharing and coordination among government departments, donors and support providers.
The Portal aims to address the information-sharing and coordination gap by improving the accessibility and visibility of useful tools & resources and technical support available to assist governments in the investment process.
While the primary audience for the Portal is government officials, policy makers and their advisors, the information contained in the Portal may also be useful for civil society and other stakeholders who want to learn more about the investment process, and how to monitor the implementation of investment projects.
The Roadmap is intended to walk the user through the various stages of planning and preparing for a large-scale investment, negotiating the main investment terms, and then monitoring and managing the implementation of the investment. It assumes that the investor is foreign and that the aim of the contract negotiation is to have a balanced and equitable outcome that both assures the investor a reasonable return and furthers the sustainable development goals of the host country.
The Roadmap is divided into four stages:
- Setting the Legal & Policy Framework - The stage when a country identifies what types of foreign investments are desirable in what sectors to further a country’s development goals and formulates clear policies that both attract foreign direct investment and benefit the country.
- Pre-Negotiation Stage - The stage when a government identifies a particular project or investment and conducts feasibility studies and environmental and social impact assessments. It is also here that a host government should prepare the necessary documentation to carry out a transparent and competitive tender process.
- Contract Negotiation Stage - The stage during which the actual negotiation of an investment contract between a government and an investor takes place. It includes the preparations for the negotiation, the assembly of a negotiation team, the development of a negotiation strategy, and the actual negotiation.
- Contract Implementation and Monitoring Stage - The stage during which the investment project is implemented. It is crucial to the sustainability and success of the project that governments have the capacity and resources to monitor compliance of the contracting parties with the laws of the land and the contract, as well as the impact of the operations and related activities on the environment and affected communities.
The database is a searchable online database of major Support Providers that assist governments in the planning, preparation for, negotiation, monitoring, and implementation of large-scale investments. It includes a brief description of each Support Provider and such search criteria as sector focus, the type of support provided and expertise available, geographical focus, response time, and whether or not a fee is payable.
The information was provided directly by each Support Provider in the form of answers to a questionnaire that each support provider was requested to complete. Responses were supplemented with further information provided during telephone interviews with representatives from each Support Provider as well as publicly available information on each Support Provider’s website. The information will be updated periodically.
It is hoped that governments (and those assisting them) will use the database as a resource when considering reaching out for support, and that existing Support Providers may find opportunities to coordinate and collaborate with other providers and funders of such support.
Tools & Resources
A repository of useful tools and resources for government officials and policy makers is provided in the Portal. It includes background information relevant to each stage of the investment process for the extractive industries, land & agriculture and infrastructure sectors, as well as guidelines, best practice guides, databases of existing and past contracts, and some model contracts. The repository is by no means exhaustive. Rather, it aims to include the information available online that is considered to be relevant, user friendly, and applicable in each context.
The tools and resources are categorized alphabetically and can be searched according to the investment stage and by the sector to which they apply.
The Trainings section includes a list of short courses and professional development courses provided globally to assist government officials and policy makers in the planning, preparation for, negotiation, monitoring, and implementation of large-scale investment projects.
The Negotiation Support Portal was developed with the support of the Australian Agency for International Development (AusAID) Australia-Africa Partnerships Facility, the US Department of State, and Germany’s Ministry for Economic Cooperation and Development (BMZ), implemented by the Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ).