Maximizing the decent work contribution of foreign direct investment

Multinational enterprises play a key role in innovation, trade, human capital formation, standards, and productivity. They also create demand in their supply chains, generate surpluses that can improve workers’ income and employment conditions, and generate know-how in ways that benefit other enterprises of all sizes. Foreign investors also tend to bring new technology and skills, which have additional economic and social development advantages. Facilitating the local transfer of good managerial and production processes, improving access to technology, and providing incentives to adopt standards are particularly promising in fostering the growth of small and medium enterprises.

To support governments in their efforts to maximize the decent work contribution of foreign direct investment (FDI) while ensuring international policy coherence, in 2016, ILO and the World Association of Investment Agencies (WAIPA) signed a cooperation agreement on FDI and decent jobs, sustainable businesses, more inclusive growth and better sharing of the benefits of foreign direct investment (FDI). ILO, with its International Training Centre (ITC-ILO), and WAIPA regularly co-organize courses on investment facilitation, sustainable development and decent work, using the MNE Declaration as the basis. Other contributing partners include UNCTAD and UNIDO.

ILO and ITC-ILO also collaborate with UNCTAD, UNIDO, UN-OHRLLS, and WAIPA to undertake a needs survey and develop an Executive College for training IPAs from 20 least developed countries (Afghanistan, Djibouti, Eritrea, Gambia, Haiti, Kiribati, Liberia, Madagascar, Malawi, Mozambique, Rwanda, Sao Tome and Principe, Senegal, Somalia, South Sudan, Sudan, Timor Leste, Togo, Tuvalu and Uganda). The survey is part of Phase I of a two phased “Capacity Development Programme for Investment Promotion Agencies of Least Developed Countries”, funded by the Enhanced Integrated Framework (EIF).

ILO Joins World Investment for Development Alliance (WIDA)

ILO became a member of the World Investment for Development Alliance (WIDA) in April 2023. WIDA's main objective is to promote sustainable investments by leveraging pluralistic partnerships to create a conducive global environment for sustainable investments. Other member organizations include the International Trade Centre (ITC), the Organization for Economic Co-operation and Development (OECD), the United Nations Conference on Trade and Development (UNCTAD), the World Association of Investment Promotion Agencies (WAIPA), the World Bank Group (WBG), the UN Industrial Development Organization (UNIDO), UN-ESCAP, African Union, Academy of International Business, and the World Economic Forum (WEF).

Since 2016, ILO has been supporting investment promotion for decent work, based on the provisions of the ILO Tripartite Declaration of Principles Concerning Multinational Enterprises and Social Policy (MNE Declaration). ILO’s membership in WIDA will create further opportunities for collaboration and synergies.
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